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FAITH Associations thank FM for acknowledging pandemic stress and urge 5 step comprehensive support

Tuesday, June 29, 2021, 16:19 Hrs  [IST]

FAITH the policy federation of all the national associations representing the complete tourism, travel and hospitality industry of India (ADTOI, ATOAI, FHRAI, HAI, IATO, ICPB, IHHA, ITTA, TAAI, TAFI) have thanked the FM for recognising the deep pain and stress of Indian tourism, travel & hospitality industry after almost 5 quarters and for including it structured relief measures announcements yesterday.

Extension of E visa waiver: The fee waiver on 5 lakhs tourist e-visas is a demand stimulus. Since the inbound tourism industry must fully recover from the scratch, from the time that it restarts, they have requested that this fee waiver be extended till at least the pre-pandemic figures of tourist arrivals is reached or till 2024 without any end use restrictions on the travelers. They have said that the fees foregone will be a notional loss of perhaps an additional ? 100 crores is a minor investment in restarting the inbound tourism which contributed to more than ? 2 lakh crores in the pre pandemic year. This will send a strong message of confidence building measure to the world which is waiting to travel again.

Reclassification of the financial support : The creation of financial support to be administered through MoT is a welcome step. Over 15 months there have been almost NIL cash flows and there is non propensity to pay interest.  Since the financial support is already guaranteed by NCGLT, it is requested that it be converted to a grant or if not, then it be made interest free.

Each quantum of support helps. However, since this industry has been without cash flows and having to pay statutory liabilities and operating expenses, they have also suggested to double the amount of financial support. Alternatively, this relief payout, may be repeated in the next quarter as the travel industry will be constrained for this foreseeable period due to pandemic in some source markets

Removal of TCS on outbound travel : TCS which was introduced in October FY 20 has made Indian tours and travel intermediaries uncompetitive. In addition of GST, now they are liable to deduct tax at source. This makes booking from Indian travel intermediaries uncompetitive as against those of based outside of India who do not have any such levies on either Indian or on international travelers. This will cause the travel transactional business to shift to outside of Indian jurisdictions. As and when travel will restart, this will become like an artificial barrier on our travel intermediaries as they look to recover from the pandemic. The added disadvantage is that if our travel intermediaries are impacted on their outbound business the inbound business to India will also get severely impacted.

SEIS Credit of SEIS dues for 2019-20:   SEIS scrips dues against tourism foreign exchange earned for 2019-20 is still outstanding which is creating significant distress as that money was spent in creating tourism demand for india.

It is requested that these SEIS dues be credited immediately to enable such tourism, travel & hospitality companies to meet their expenses and to take care of their employees.

Waiver of Statutory Dues: Despite no revenues, there are statutory liabilities & compliance liabilities at both state and central Government level & other regulatory bodies which still need to be met. These include various forms of duties, taxes, cess or license fees including electricity & water, property taxes, excise duties, state professional taxes, transport taxes, parking cess, insurance premiums, provident fund, ESI contribution and any penalties thereof on hotels, travel agents, tour operators, restaurants tourist transporters or any other form of tourism travel & hospitality service. It is requested that all states governments and the respective Central Government ministries to waive off these fixed levies & compliances till the period of the pandemic. Alternatively, a corpus with Ministry of Tourism be set up to meet these monthly liabilities of tourism travel & hospitality companies to discharge them on their behalf.

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