The Travel Agents Association of India (TAAI) has voiced its dissatisfaction with the interim budget presented by Finance Minister Nirmala Sitharaman on February 1, 2024. Despite multiple representations addressing critical issues such as ease of doing business, GST, and TCS, the travel industry’s concerns were overlooked.
With the new government now in office and the Union Budget 2024 approaching, TAAI has reiterated its earlier requests in a detailed communication dated July 5, 2024, to the Finance Minister and Tourism & Culture Minister Gajendra Singh Shekhawat, and Civil Aviation Minister Kinjarapu Rammohan Naidu.
TAAI’s Key Requests:
Infrastructural Development:
Establish new airports through private participation.
Expand rail, road, and waterways (including sea and river cruises).
Develop high-growth areas such as religious circuits, MICE, wellness tourism, and lesser-known destinations like Lakshadweep.
Simplified Visa Requirements:
Encourage visa-free entry for tourists to significantly boost foreign tourist arrivals.
Reducing Aviation Turbine Fuel (ATF) Costs:
Lower ATF costs to pre-pandemic levels to improve air travel accessibility.
Rationalization of GST Rates and GST Credit:
Implement a more favourable GST structure that allows input tax credit for holiday businesses. This could make hotel stays more affordable, thus promoting tourism and encouraging investment in the sector.
Strategic Reduction in Income Tax:
Reduce income tax rates to catalyse growth in the country’s tourism industry.
Abolishment of TCS on Outbound Travel:
Remove TCS on outbound travel to prevent disincentivizing Indian travel agents, tour operators, and travellers.
Tax Exemption on Leave Travel Allowance (LTA):
Encourage domestic travel and boost tourism within the country by offering LTA tax exemptions.
Removal of TDS on Automated Bookings:
Reduce administrative burdens for travel businesses by removing TDS on automated bookings.
Simplification of Licensing Requirements:
Ease business operations by simplifying licensing requirements.
Industry Status for All Stakeholders:
Grant industry status to all stakeholders in travel, tourism, and hospitality.
The Union Budget 2024 holds significant expectations for India’s travel and tourism sector, which currently contributes 5.8% to the GDP and aims to reach a target of USD 1 trillion by 2047. TAAI hopes the upcoming budget will address these priorities, helping to unlock the full potential of India’s travel and tourism industry.
