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Budget 2023 expectations: Travel industry wants tax benefits and more for speedy recovery

Budget 2023 expectations: Travel industry wants tax benefits and more for speedy recovery

Budget 2023 expectations: Travel industry wants tax benefits and more for speedy recovery
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By CNBCTV18.com Jan 25, 2023 1:24:28 PM IST (Published)

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SUMMARY

After a bumpy ride in 2020 and 2021, which were severely impacted by the COVID-19 outbreak, the travel industry has bounced back and is benefitting from the pent-up demand. While it is in recovery mode, the sector is yet to reach pre-pandemic levels and expects to benefit from the Budget 2023. These are some of the expectations from the Budget 2023.

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The travel and tourism sector, one of the most affected by the COVID-19 pandemic, is slowly recovering but still faces challenges in the form of high GST rates on flights and hotels, making it difficult for the industry to compete with other countries and attract tourists. The sector is also concerned after the limited help provided by the government in the last budget. (Image: Shutterstock)

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The government should formulate a well-defined procedure for refund of IGST (Integrated Goods and Services Tax) paid by the tourists leaving India on supply of goods taken out of the country as a part of the baggage. As the business is still recovering, the exemption is crucial. (Image: Shutterstock)

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Travel services offered to foreign nationals should be excluded from the GST. ATF (aviation turbine fuel) should be brought under the GST ambit to provide relief to the airlines sector. (Image: Shutterstock)

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Nishant Pitti, CEO and Co-Founder of EaseMyTrip told Moneycontrol that putting more of an emphasis on the industry's resuscitation is necessary. This may be achieved by adopting an e-visa fee waiver for tourist visas as well as a domestic income tax travel credit for Indian residents and Indian businesses. (Image: Shutterstock)

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There are heritage sights and monuments that can contribute to a rise in tourism in India but are unexplored due to poor infrastructure. The budget can work on redeveloping these sights, and the roads and make them better accessible. (Image: Shutterstock)

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The travel sector has recovered after two difficult years and is back on track with rising passenger numbers. Many in the insudtry are anticipating the government to grant tax incentives in the future budget to lower the cost structure of airports and airlines in order for this momentum to continue. Tax reductions and deductions for air travel will further hasten the sector's expansion. Deductions for domestic travel and tourist-related expenses from IT will increase tourism, which will improve both domestic and foreign travel. (Image: Shutterstock)

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The government of India must concentrate on expanding capacity, especially a quicker implementation of the next-generation Vande Bharat trains and other means of transportation. Corporations should be given incentives for holding meetings and conferences in India by providing partial or whole tax deductions on the spent expenditures. This will increase domestic travel and tourism. (Image: Shutterstock)

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The augmentation of the Leave Travel Allowance (LTA) to once a year from twice in four years will increase domestic tourism. (Image: Shutterstock)

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Travel firms are also focusing on push for sustainable travel. While ensuring that the sector stays lucrative, the country must shift toward more sustainable means of transportation. Introducing green tax incentives or giving subsidies to travel agencies investing in green technology would be excellent initiatives. (Image: Shutterstock)

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