Many tourists use Indian tour firms to reserve travel arrangements for nearby nations like Bhutan, Nepal, and the Maldives. However, since the levy, they preferred making direct reservations with travel agencies in those nations.
In NEW DELHI: The Centre’s decision to remove the clause imposing a 5% tax collection at source (TCS) on the sale of international tour packages to foreign tour operators has been welcomed by the Indian Association of Tour Operators (IATO).
Since October 2020, international tour operators or individual foreign visitors to India must pay 5% TCS on their invoices to Indian tour operators. The tax had previously been eliminated for individual international visitors.
Industry organizations had pushed for the provision to be removed. This tax elimination will help both individual international travelers and foreign tour providers. It will also make tour packages offered to foreigners by Indian tour operators a little less expensive, offering some relief to the industry that has been severely damaged by the pandemic.
Many tourists use Indian tour firms to reserve travel arrangements for nearby nations like Bhutan, Nepal, and the Maldives. However, since the levy, they preferred making direct reservations with travel agencies in those nations.
Many tourists use Indian tour firms to reserve travel arrangements for nearby nations like Bhutan, Nepal, and the Maldives. However, since the levy, they preferred making direct reservations with travel agencies in those nations.
“This notification implies that both foreign persons and FTOs (buyers) buying international travel packages from the Indian tour operators will be excluded from TCS requirements,” said Rajiv Mehra, president of the IATO. The international traveler doesn’t need to visit India before continuing to the next nation. In addition, FTOs and corporate entities founded abroad without a permanent presence or branch in India would be free from the TCS requirements.
He continued by saying that because of this tax, Indian tour operators were losing a lot of customers and that the government was also losing foreign exchange because all of the money was moving to other nations.
The travel and tourism sector had its sights set on the Union Budget earlier this year to speed up recovery. Their demands included this tax exemption.
Follow and connect with us on Facebook, LinkedIn & Twitter
