Budget carriers wanted, needed, but not welcomed in Russia
The regulation on having at least eight airplanes with capacity of over 50 seats on board came into force last November and forced Kuban Airlines to cease activities – their fleet consisted of only six.
This regulation literally prevents low-cost carriers from entering the market, Andrey Shnyrev from Department of State Policy on Civil Aviation told Vedomosti daily. Obliging airlines to pay high compensation for delaying or canceling flights might be a good option to replace this regulation with, Shnyrev said.
These measures are common and accepted worldwide, the newspaper quotes a representative from airline Utair. However, dropping value added tax (VAT) is what can significantly lower the price on tickets, and the government is strictly against this, the representative said.