The Finance Minister (FM), Nirmala Sitharaman, in her Union Budget speech on Tuesday (July 23) once again ignored the travel trade in India, said the Travel Agents Association of India (TAAI). The association had sent pre-budget requests to the FM and has expressed shock at the zero-response received from the Government of India. Despite being one of the key drivers of economic growth and employment, the sector has been notably underfunded and overlooked in the latest budget, stated TAAI.
“The FM in her speech highlighted infrastructure development for only two to three religious locations which shall be taken up for development and promotion by the government. These religious circuits are totally raw and need a huge push. Rather than upgrading the current locations and enhancing last mile connectivity to popular locations the government is trying to push destinations where connectivity is a huge challenge and there is lack of interest in the domestic as well as the inbound tourism market,” the association said in its press release.
“We appreciate the decrease of the TDS for all e-commerce platforms from 1% to 0.1%. and a simpler tax regime for foreign shipping companies’ operating in the domestic market,” added the statement.
Requests for rationalisation of GST rates for inbound, outbound as well as domestic travel doesn’t seem to be of importance to the government, as per the association. TAAI has made multiple demands to permit GST input credit for interstate hotel rates which would thereby allow the hotels as well as passengers to avail of input credits in their businesses.
The main concern raised by TAAI was on the abolishment of TCS on outbound travel which is hindering the ease of doing business for Indian travel agents and increasing the competition with global players from overseas not levying GST or TCS to the passengers.
“The budget falls short in launching robust campaigns to boost domestic tourism, which has become increasingly crucial in the current global context. Promoting local travel can drive immediate economic benefits and foster a culture of exploring India’s diverse attractions,” said TAAI.
