Mumbai: Suggesting a slew of targeted tax relief measures to stem the attrition of Indian pilots to overseas airlines, pilots' body ALPA India has urged the civil aviation ministry to take up the proposals with the finance ministry ahead of the final reading of the Finance Bill for FY28.
In a letter to Civil Aviation Secretary Samir Kumar Sinha on September 28, ALPA India, an affiliate of the international pilots' body IFALPA, claimed that attrition is driven not only by gross salaries but by a tax-driven gap in take-home pay, which effectively more than doubles the real income for pilots who relocate to zero-income-tax jurisdictions such as the Gulf nations.
These measures include increasing transport allowances exemption cap to Rs 30,000 a month from Rs 10,000 a month, hiking customs duty-free allowance for returning air crew to Rs 15,000 per trip from Rs 2,500 per trip at present, according to ALPA India.
The pilots' body has also suggested specific exemptions for pilots for transport/uniform allowances in the Bill, as there is no such provision in the existing budget. It has also proposed doubling the standard deduction for licensed pilots from the present Rs 75,000, or allowing the actual deduction, whichever is lower.
ALPA India has also suggested presumptive taxation for non-salaried, contract and charter pilots by notifying commercial pilots as specified profession in the Budget for next fiscal.
The Finance Bill 2027-28 remains under Parliamentary consideration. A formal inter-ministerial recommendation from MoCA to the Department of Revenue, received before the Bill's third reading, can still be examined for inclusion, ALPA India said.
ALPA (Airline Pilots' Association) India also alleged that direct representations from pilot bodies to the finance ministry have gone unanswered since 2021, leaving the civil aviation ministry's institutional voice as the only remaining escalation pathway within this Budget cycle.
Noting that India will need approximately 30,000 additional pilots over the next 15-20 years to support its planned aviation expansion, including the UDAN/RCS network now connecting over 80 regional airfields, the pilots' body said that this demand cannot be met if the experienced cohort already trained at a cost of Rs 1-1.5 crore and 8-10 years per pilot, continues to depart for tax-free Gulf markets.
It also said that when experienced captains and senior first officers depart, Indian carriers accelerate command upgrades of less-experienced crew.
Average command experience levels, measured in total hours at the time of captain upgrade, have been declining across the sector, ALPA India said in the letter.
These measures are also directly connected to India's own ICAO submission in August last year on pilot attrition and to the civil aviation ministry's regional connectivity UDAN scheme targets, as per the letter.
"The Indian government through the civil aviation ministry submitted a working paper to the International Civil Aviation Organisation in August 2025 formally flagging that foreign carriers are actively recruiting experienced pilots, engineers, and cabin crew from Indian carriers, adversely affecting the sector's orderly growth," the pilots body stated in the letter.
The same ministry that raised this concern internationally is "best placed" to champion the domestic tax policy remedy, ALPA India said and added that "doing so would demonstrate institutional consistency and give India's ICAO position practical effect.
Tax relief that retains experienced pilots is therefore an investment in MoCA's own policy targets, not merely an industry welfare measure, it said in the letter.
