Sunday, February 28, 2010

Travel and Tourism Industry Gets a Shameful Miss in the Union Budget 2010-11

In the Budget 2010-2011 presented by Finance Minister Pranab Mukherjee, the aviation and tourism sector of India again got a miss. While tourism disbursal has been shot up to Rs 1050 crore for the year 2010-11 as against 2009’s Rs 950 crore, several areas were still ignored. These included the key demands of the Indian tourism industry like the need for exempting the inbound tour operators from service tax, exporting status for the travel industry, including ATF in the list of declared goods for uniform taxation, making air travel within India cheaper by abolishing the fuel surcharge, rationalizing taxes on state transport and forming a National Commission for Tourism under the PM’s leadership. 

To sum it up, the only good thing to come out of this year’s budget for the tourism industry in India was the announcement which talked about the Income Tax Act investment deductions to the hotel developing companies (2 star hotels and above). Instead of focusing more on the travel industry and meeting demands and expectations, the finance ministry proposed of adding service tax on domestic and international air fares for every class. This leaves us with the conclusion that with the addition of service tax on domestic journeys the cost of air travel will climb up by 10%. 

But while the parliament has been ignoring the tourism industry of the country, the Foundation for Aviation and Sustainable Tourism (FAST) has planned a seminar on Destination Management and Sustainable Tourism in Delhi on March 2, 2010. The states of focus on this daylong seminar will be Chhattisgarh, Madhya Pradesh and Sikkim and will be attended by the delegates of the Indian tourism industry.