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Industry has ‘BIG’ expectations from Union Budget 2021-22

With covid-19 bringing the entire travel, tourism, and hospitality sector to a standstill along with  no stimulus package by the government for the recovery of the tourism industry, leaders of the industry are expecting some significant announcements for the travel and hospitality sector in the forthcoming Union Budget 2021-22. T3 presents below the expectations of the industry. 

Deep Kalra, Founder and Group Executive Chairman, MakeMyTrip, said, “Despite the far-reaching impact of COVID-19 on the industry and without any aid in the form of a stimulus package, the travel & tourism industry is trying to find its feet and take initial steps towards recovery. In the short-term the industry is looking for assistance in the form of rationalization of taxes, extension of moratorium period, and waving off certain statutory obligations. We hope that in the upcoming budget the Government takes note of the sector’s role in the entire economic value chain and makes the long-due decision of including travel & tourism in the concurrent list. As domestic tourism holds key to recovery, I-T deductions on domestic travel undertaken by the taxpayer will help in encouraging people to travel more domestically – further benefitting the larger ecosystem. On the corporate travel front, the Government should set sight on incentivizing MICE business – that would perhaps be the last to recover and offer 200% weighted deduction to companies on MICE expenses over the next two years or more. Overall, the industry is looking towards certain concessions and rebates for travel and tourism to pick pace and move towards pre-Covid levels.” 

Madhavan Menon, Chairman & Managing Director, Thomas Cook (India), said, “While the Government has rolled out economic relief packages for several industries, the Tourism sector has been noticeably absent and the Union Budget offers valuable opportunity to address the crisis in the sector. With the extended ban on international commercial flights, domestic tourism offers strong potential and this requires priority support or swathes of tourism dependent communities will languish and with it rapid dwindling of our precious local art forms, heritage and culture. Innovative and viable initiatives like UDAN that catalyse regional connectivity and offer access to India’s hidden gems needs to see sustained delivery. Budgetary outlay that retains long term impact via infrastructure development is equally essential– roads, railways, airports, waterways; as also health, safety and sanitation – a top priority in travel decisions in this COVID era. I also look forward to the Government support and priority action: soft loans to finance working capital, incentivising tourism spends by providing income tax concessions, payment of overdue SEIS benefits, easing of indirect taxes and waiving off TCS to help aid recovery.”

Rohit Kapoor, CEO, OYO - India & South Asia, said, “This year’s Union Budget is expected to be truly reformative given the unpredictable circumstances we are presently in. As the entire country prepares for the upcoming budget, a focus on growth-oriented measures, economic reforms and inclusive growth will be critical to bring the COVID-battered economy back on track. We are hopeful for some stimulus package, uniform taxation, an extension of the moratorium period so that our small hotel partners can benefit from the required working capital to sustain these challenging times and thereby, meet their operational costs, retain jobs and boost domestic tourism, an integral contributor towards India’s robust revival story. The government should continue to promote entrepreneurship to foster a culture of innovation using emerging technologies like making regulatory processes easier and offering incentives to those who set up their start-ups in remote towns.”

Vishal Suri, Managing Director, SOTC Travel, said, “We look forward to the Union Budget 2021 bringing in concrete measures that target revival of the economy and boosting consumer sentiment/consumption. The Travel & Tourism sector is a vital contributor to the country’s GDP and a significant employment generator. With a focus on domestic tourism sector in the current era of travel there is strong potential to develop smaller cities/towns in India for tourism in line with Prime Minister’s vision of being Atmanirbhar Bharat and further strengthen Make in India. This will also give a boost to local communities. We hope to see proactive reforms, supportive policies and budgetary allocation, with immediate waiver of TCS for the tourism sector - critical in stimulating demand.”

Pushpendra Bansal, COO, Lords Hotels and Resorts, said, “According to industry sources, the hospitality industry has suffered an estimated ₹90,000 crore revenue loss in 2020 due to   coronavirus pandemic. We hope that this budget the government will give infrastructure status to hotels which will result in long term funding at lower interest rates. Hotels should also be charged power rates applicable to industries. Reduction in GST rates from 18% to 12% on room tariff as this will help to improve occupancy and help Indian hotels be more competitive and on a par with other Asian economies. Single window clearance for licensing should be introduced to promote ease of doing business.”

Vineet Verma, MRICS, Executive Director & CEO, Brigade Hospitality, said, “Hospitality & Tourism sectors have been the worst hit during this pandemic and truly deserve to be resuscitated with Government’s support, both at the Centre and the State levels. While some measures have indeed been rolled out, these are not enough and a lot more is required to be done. It is important to extend some breathing space to the almost choked industry before it finds its own way to recover to pre-COVID levels. Some of the additional measures that we urge our Finance minister to consider are:

 Waiver/reduction of Interest on Loans, for the lockdown period; ECLGS though welcome, should have working capital loans with reduced rates of interest; Drastic Reduction in GST rates for hotels & restaurants for 2021-22 to help boost travel & tourism; MV Act notification on ‘One Nation One permit’ to be expedited to help boost inter-state movement of tourist vehicles; Impress upon respective State Governments to refund part of License fees & duties for the lockdown period. This includes Property Taxes, Liqour licenses etc; Accord Industry Status to Hospitality sector; The Industry is fighting hard to survive this crisis and we do look forward to our Government’s support in helping us revive the sector.”

Manish Rathi, CEO & co-founder, IntrCity RailYatri, said, “The covid-19 pandemic breakout impacted the travel and mobility industry at large, the year 2020 is a watershed moment for the industry. In order to provide the much-needed impetus to revive the travel & mobility economy in India, the industry is expecting long-term initiatives that will help infuse positivity and bring back growth to the economy. Today private intercity buses are already the single largest mode of intercity travel. As things stand the role played by the private intercity buses is going to increase further in the next five years. This growth in the inter-city travel segment is directly linked to GDP growth and catalyzed by budget allocation for investments in highway networks across the country to focus on enhancing infrastructure and last-mile connectivity. We hope that the government will prioritize the measures necessary to keep a check on pollution levels and therefore arise the need to promote economical and eco-friendly – Electric, CNG and H-CNG based fuels. Further, to encourage MSMEs and startups, simplification of Employee Stock Option Plans (ESOP) should be proposed.”

Aditya Chamaria, Managing Director, Damodar Ropeways & Infra Limited, said, “Ropeways are at an important intersection of the infrastructure and tourism industries and are also environment friendly. In the present times, a lot of State Governments are considering utilizing cable cars for urban transportation as they are eco-friendly, pollution-free and can be put up at very competitive prices by experienced companies like us. We expect and hope that the Government realizes the full potential of ropeways to boost tourism and enhance connectivity in this Union budget 2021-22. GST on ropeways currently is at 18%, that is higher than that on air travel, which is at 12%. In fact, ropeways should be treated at least at par with Railways where the GST is 5% with input tax credit at a minimum because they cater to all sections of society. There is a great volume of licenses, permits and general bureaucracy that needs to be navigated in order for a ropeway project to actually materialize. Moreover ropeways are usually made in places which are not accessible by other modes of transport, and are also able to maintain the general landscape of the space. Therefore, subsidies to the extent of 30 – 40% should be given in order to bolster this necessary industry."

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