Travel industry rides on high hopes from Union Budget 2014

FE Online Posted online: Tuesday, Jul 08, 2014 at 0000 hrs
Mumbai : A day before the Union Budget 2014, the entire travel and hospitality industry has high hopes from the Modi- led BJP government. The industry expects major reforms in the taxation policies and hopes to see a pro-tourism budget. Here are some of the key demands by the industry:

Subhash Goyal, president, IATO

“Government has already taken a decision to introduce E-Visa for 180 countries. However, this needs to be implemented immediately for tourist arriving at all the metro cities. There is a stated policy of the government that the tax should not be exported and export of service should be tax free. However, the tour operators appear to be exception to this. It is requested that the inbound tours operated for foreign tourists should be completely exempt from the levy of service tax in line with the government policy for not passing the tax burden on the foreigners. Also, place of provision act should be abolished in case of inbound and outbound tours providing services on its value for earning foreign exchange and services on foreign land. There is an urgent need to form Tourism Development Authority. Skill Development Council to be formed immediately for which primary work has already been undertaken by the Tourism Ministry. Once the above aspects are looked into, we are confident that international tourist arrivals to our country will increase from 40 to 80 per cent.”

S M Shervani, president, FHRAI

“FHRAI's recommendations for the forthcoming Union Budget have focused on policy measures which can allow our industry to deftly navigate the myriad near-term challenges which we confront and also build a strong foundation for the sector's rapid and sustainable future growth. We believe that there are three key priorities which merit the finance minister's urgent consideration -rationalisation of our industry's multiple tax structure, facilitating a broad spectrum of institutional mechanisms by which the hospitality industry, including our small and medium enterprises, can access lower cost long-term finance, offering fiscal concessions and incentives to help mobilise the massive capital investment of over INR 1,25,000 crore, which is required to augment the country's hotel room inventory by an additional 1,80,000 rooms.”

Rajeev Wagle, managing director, Kuoni India

“With the tourism industry being one of the largest sectors in the world, it augurs well for the travel industry as one of the largest employment generators. The UNWTO also expects the sector to provide 296 million jobs globally by 2019. We optimistically hope for a growth oriented budget that will give tourism industry the added boost required. The Union Budget of 2014 – 2015 must focus on the enhancement of tourism infrastructure, rationalisation of taxes leading to an increase in both corporate and leisure travel.”

Arun Nanda, CEO, Mahindra Holidays

“I hope that the government takes travel and hospitality industry seriously in this Union Budget and brings new policies for us. There should be a rationalisation of taxes, as there are lots of taxes levied as of now like the VAT, service tax, luxury taxes,etc. Also, the government should give speedy permissions and remove the irrelevant procedures in the hospitality space, so that we can complete our projects in due course of time to serve the people.”

Sharat Dhall, president, Yatra.com

“We welcome the new government’s initiatives in promoting tourism and are optimistic that the budget will include reforms which will help boost the tourism industry in India. We are hoping for a relaxation in ATF to boost cheaper air travel, a re-look at the service taxes for holiday packages, and the introduction of FDI in the Railways which will help infuse greater effectiveness and efficiency in India’s dynamic tourism industry.”

Neelu Singh, COO, Ezeego1.com

“We would expect the new government to bring in vital tax reforms across the country that help tourism, improve the current state of economy and position India as a globally competitive tourist destination. It is also imperative to enhance our current infrastructure capabilities to be able to handle a large influx of tourists. This includes physical infrastructure such as ports of entry and different modes of transport as well as urban infrastructure such as access roads, electricity, water supply and telecommunication. Rationalising tax on ATF is crucial, since the entire aviation industry today is grappling with high ATF prices. Also, airport modernisation across the country, especially in smaller towns, is required for better management and operation. Most importantly, there is a pressing need to address issues regarding safety of single female travellers within India.”