Under the able leadership of Mr. Nakul Anand, Chairman, FAITH, the Federation of Associations in Indian Tourism & Hospitality (FAITH) recently released its list of 10 budgetary recommendations for revival of the tourism sector.
Titled “Ten to Win”, recommendations by FAITH includes:
- One India, One Tourism – National Tourism Council
- GST Policy Corrections for Tourism
- Infrastructure Sector Status
- Export Status
- Domestic Travel Tax Credit
- SEIS Credit against Forex Earnings
- Underwriting Fund for Travel Agents and Tour Operators
- Global MICE Bidding Fund
- Seamless Tourism Transportation
- Corpus for Sub Branding of three Tourism segments
According to Mr. Subhash Goyal, Honorary General Secretary, FAITH, “Tourism industry is the worst affected industry. Out of about 75 million people who are directly or indirectly employed in this industry – about 30 million have lost their jobs and about 10 million are on leave without pay. About 53,000 Travel Agents, 1.3 Lakh Tour Operators and thousands of Tourist Transporters and Tourist Guides are struggling to survive. Like in other countries, Indian Tourism industry did not receive any survival financial package from the Government. Therefore, we hope that this Budget will give us some relief so that this industry can revive and millions of jobs are saved.”
Our expectations from the Budget are:-
- Uniform GST rate of 10% on Hotels and Restaurants with input credit.
- One year tax exemption to the Tourism and Hospitality industry so that they are able to survive.
- All statutory payments like electricity, excise fee, transport permits to be exempted for the lock down period.
- Banks to be instructed to give priority funding/loan at maximum of 5% interest for 5-10 years at least.
- GST/Tax exemption for Corporates to hold their conferences within India instead of abroad.
- Tourism industry’s foreign exchange earnings to be fully recognised as export earnings at par with merchandise export.
- Tourism and Hospitality industry to be given an infrastructure status.
- Tourism industry to be put on the concurrent list of the government.
- Increase SEIS to 10% on all foreign exchange earnings to members of the tourism industry for at least 5 years to help them to recover from the Covid-19 crisis.
- A global MICE bidding fund to be created so that India can bid to get more international conferences, meetings and events to take place in India.
- To encourage Domestic Tourism, private organisations/companies should be given tax incentive for allowing their staff to go on LTC tour.
Meanwhile, Travel Agents Association of India (TAAI) has put forth some suggestions to the Government that will help in good governance and ease of doing business for the trade.
Mrs. Jyoti Mayal, President TAAI, stated, “We believe the Budget 2021 should be focused more on spendings to enable economic growth, what better area to spend in than tourism to generate more cash flow & earnings to enable enhancement of infrastructure.” Some of the suggestions includes –
One India One GST: The Association has already appealed for have a uniform GST across India whereby input tax credits can be taken for services utilised across the country. The GST for tour operators should be at 1.8% with full setoff, being 18% on an average margin of 10%. Interstate credit of GST are not available to travel agents and tour operators on IGST and the same should be considered at par which shall not only benefit the corporates but the consumers are large. The similar being with airlines on the point of departure.
“TAAI is expecting the FM to ensure LTC benefits not utilised this year due to the pandemic should be permitted to be carried forward in the coming 2 years. Further to boost the economy all expenses made for travel, tourism, MICE, adventure, domestic and religious travel, by the tax payer should be fully exempt from income tax for the next 2 years,” stated Jyoti Mayal. The FM should also ensure 10% SIES credit to be adjusted completely under income tax.
