Union Budget 2021-22 Expectations for Travel and Tourism: Hit difficult by the Covid pandemic in 2020, the Travel and Tourism sector needs a pathbreaking Budget 2021, hope market professionals. However, provided the enormous Covid 19 vaccination system in India, Finance Minister Nirmala Sitharaman might not be in a position to announce important monetary outlay. However, persons connected with the Travel and Tourism market are hoping that the Narendra Modi government’s Budget 2021 will not only pull the sector out of the recessionary circumstances but also enables the Indian Tourism market to claim its rightful leadership location.
“With a focus on executing the Covid vaccination program in the country and increased burden on the exchequer, it seems less likely that Budget 2021 will relieve the tourism sector in the form of significant financial outlay. Accordingly, we believe that the Union budget announcement will have a greater appetite for revenue-neutral interventions,” Vivek Agarwal, Partner – Infrastructure, Government and Healthcare (IGH), KPMG in India.
“The revenue-neutral interventions are structural reforms for integration of regulation and approvals to move towards a one-stop-shop approval process for hospitality projects, revitalise the Incredible India campaign in preparation for 2023 when India will host the G20 summit, restructure and redesign current infrastructure schemes of MoT to encourage development focused on Return on Investment, tax benefits by moving LTC benefit to the next financial year, tax exemption on MICE events, GST restructuring for wellness and medical tourism businesses, and induce liquidity for tourism businesses by way of financial reforms such as provision of funding from non-banking institutions, alternate tourism investment fund to support ongoing hospitality projects, longer tenure of repayment of finances,” Mr. Agarwal stated.
The Federation of Associations in Indian Tourism and Hospitality (FAITH) is also hunting forward to the Union Budget 2021 with wonderful expectations. The FAITH has proposed the creation of a National Tourism Council of Chief Ministers headed by Prime Minister Narendra Modi along with Tourism Minister. That should really be supported by a widespread market status across the nation for the full tourism market by placing it in the concurrent list.
The FAITH has encouraged export earnings be produced tax totally free and also incidence of taxes in tourism earnings be zero rated. Additionally, ervice Exports from India Scheme (SEIS) of 10 per cent to all foreign exchange earning members in tourism be produced applicable for 5 years to guarantee a post-Covid recovery. A Global Mice Bidding Fund is needed to be set up with Rs 500 crore to double India’s mice share. Indian missions abroad in each and every nation should really be activated with tourism sources for maximum attain. This requires to be supported with Corpus of least Rs 2500 crore is needed for international branding spending budget to allow Sub Branding of 3 Tourism segments i.e. Indian MICE, Indian adventure, Indian Heritage below the Incredible India most important brand, the FAITH has stated.
To guarantee that the tourism market becomes a mainstay domestic market there requires to be a concerted tactic. There requires to be produced an earnings tax exemption on travelling inside India earnings tax credits for up to Rs 1.5 lakh when spending with GST registered domestic tour operators, travel agents, hoteliers, and transporters anyplace inside the nation. It is also required to incentive Indian corporates to undertake domestic mice (meetings, incentives, conferences and events) by providing a 200 per cent weighted earnings tax expense advantage to Indian corporations which are undertaking mice events in India. A Natural & Cultural Heritage Restoration Fund need to be set up with a corpus of at least Rs 2000 crore which encourages sustainable and accountable improvement about each and every vertical of adventure tourism and cultural tourism. This will also be enabled by a definitely seamless tourist transportation knowledge standardizing all tourism transportation taxes creating them payable at a single point which will facilitate the ease of undertaking small business, the FAITH has stated.
“It is critical to protect the business of Indian travel agents and tour operators and a structured mechanism is required to future secure travel agents’ payments to ensure that security for travel agents and operators’ survival. This is key as Travel agents’ payments to principals are unsecured credit and some form of mechanisms whether escrow or guarantee or underwriting based mechanisms are needed to be in place to ensure that travel agents’ money stays secure,” the FAITH stated.