India tribunal rules British Airways's ground and engineering income taxable
Business
British Airways just got some tough news from India's tax tribunal: money they make from ground handling and engineering services for other airlines in India is taxable here.
The airline argued these services were part of regular flight operations and should be tax-free under the India-UK tax treaty, but the tribunal didn't agree.
Article 8 limits exemptions to flights
The tribunal explained that only profits directly from flying planes internationally are exempt under Article 8 of the treaty, not extra services like ground handling.
Unlike deals with Germany or the Netherlands, the U.K.-India treaty doesn't have a "pooling" clause to widen those exemptions.
Tax experts say this shows how treaty rules can change depending on which countries are involved.