New Delhi, July 28 (UNI) Federation of Associations in Indian Tourism & Hospitality (FAITH), the policy federation of all the ten national associations representing the complete tourism, travel, and hospitality industry of India DTOI, ATOAI, FHRAI, HAI, IATO, ICPB, IHHA, ITTA, TAAI & TAFI, has thanked the Fitment Committee for considering favorably the drawback of taxes on foreign tourists on their goods purchases in India.
They have recommended five rationalization measures across the tourism, travel, and hospitality value chain for consideration for the next GST Council meeting. *Hotels to be allowed to charge IGST which will enable seamless availability of credit across India to all travel agents and tour operators and will thereby lead to building up a sustainable domestic holiday and meetings and conventions business within the country.
Tour operators are to be enabled a special presumptive GST rate of 1.8 percent with full GST set-offs. The current rate of 5 percent without setoffs structurally implies that tour operators have an inbuilt margin of around 27.8 percent which is an inherently flawed assumption of the prevailing business models. This by default creates an inherent linkage to value addition only and prevents a tax on tax.
fees and taxes on fuel which are their biggest input costs.
Restaurants should be also allowed the additional option of charging GST at 12 percent with full Input tax credits and the rate should be de-linked from any room tariffs if they are part of hotels.FAITH mentioned, that Indian tourism has travel Agents also allowed the option of exploring the reseller model for charging as they are distribution arms for airlines. This option will enable travel agents to structure optimal partnerships as per their business requirements between their clients and their airline partners.* Tourist transporters be allowed the provision for avail- ing GST set-offs on interstate Tour- ist transport taxes, taxes on parking mense inherent potential to create up to 10 crore additional jobs pan India over the long-term period, triple its GDP contribution and create forex earnings up to $75 – $100 billion and GST is a key enabler for creating this global and domestic competitiveness in tourism directly and through its indirect impact.
