The Federation of Associations in Indian Tourism & Hospitality (FAITH) has appealed to the government to withdraw the increase of Tax Collected at Source (TCS) on overseas tour packages from 20% to 5% announced in the Finance Bill 2023. The industry body argued that such a step would spell disaster for domestic tour operators, making them financially uncompetitive when compared to their foreign counterparts who are not liable for this charge.
FAITH Chairman Nakul Anand expressed concern that the rise in TCS could have dramatic consequences for the travel businesses, especially the MSME sector, which make up for more than 95% of the industry. He added that businesses may have to shut down and people may lose their jobs as bookings are more likely to be made with foreign tour operators.
In view of these risks the board of FAITH has urged the government to not only rollback the TCS rate to 5% but further reduce it to 2.5%, so that more and more people choose to book their foreign trips through Indian tour operators. The Federation also wants to ensure that its goal of bringing more people into the tax net is met.
India’s Travel & Tourism industry is a key economic pillar, accounting for nearly 8.8% of the country’s GDP and employing 45 million people. FAITH is the apex body of outbound travel Associations such as the Association of Domestic Tour Operators of India (ADTOI), IATO, OTOAI, TAAI, and ICPB among others. It advocates for the growth and development of Travel & Tourism in India and works with the government for the benefit of the industry.
Nakul Anand, a veteran of the tourism industry, is the Chairman at FAITH. He has a vision of making India the number one travel destination in the world. He is committed to uplifting the industry, especially the MSME sector, and works towards creating a conducive ecosystem for the growth of Travel & Tourism in India.