Pass on the benefits of reduced GST and e-visa fee to end users, Pronab

Reacting over the two major developments – reduced e-visa fee and GST rates on hotels, in Indian tourism and hospitality sector, President of Indian Association of Tour Operators (IATO) Pronab Sarkar said that it is imperative for the industry to utilize this golden opportunity, and help grow the business and increase the share for every stakeholder.

Introduction of a flexible e-tourist visa regime is based on tourist footfall, with higher fee for July to March which is the peak season and a considerably lower fee if the visit to the country falls during April to June – the lean period.

On the hotel tariffs front, daily room tariff beyond INR 7,500 per day will attract GST at the rate of 18 per cent as against existing 28 per cent. Room tariff betweenINR1,000 and INR7,500 will continue to attract 12 per cent GST. There will be no GST on room tariff up to INR1,000.

According to him, the entire tourism and hospitality industry is charged up with this encouraging decision of the government. “Rationalization and reduction of GST on hotel services was our long pending demand in order to compete with the neighboring countries of India,” says Sarkar.

“We are sure reduction in GST on hotel accommodation and e-Visa fee, will give boost to the Indian Tourism Industry and it will attract more foreign tourists and create more job opportunities in the sector. The end users will get the benefit of this announcement as with this substantial relief in GST rate on hotel rooms, our package cost will reduce. We are sure Domestic tourism shall also increase with in the country due to reduction in GST rates for hotel accommodations.”

Sarkar feels that the reduction in e-visa fee and GST, both together shall help reduce the total cost for tourists to look up towards visiting India. The high e-visa fee and highest GST was the main hurdle to attract tourist to India in comparison to our neighboring countries like Thailand, Malaysia and Sri Lanka where both the rates were lower than India and we were losing a major chunk of business including MICE business in competition.

“After the announcement of both the issues, we are confident now that all hotels and tour operators shall work together to pass on the benefits of this reduction to the tourists and end users. This is the golden opportunity and responsibility of the industry to show the drastic growth in near future as Government has given to the stakeholders whatever they wanted,” he added.

IATO President further says that this is for the stakeholders to prove by showcasing the growth not only of tourist arrivals but also creating more jobs. There should be tremendous growth in volume of business, which will not only generate additional foreign exchange but also revenue to the government in the form of taxes and as many times the money changes hands it will generate more taxes in the hands of Govt.

“Once there is a growth in tourist’s arrivals that will create additional jobs also in Tourism and hospitality industry,” he concludes.