Budget 2024: What To Expect For The Travel And Tourism Sector (image@FinMinIndia)
India’s interim Budget for the fiscal year 2024-2025 will be released on February 1, 2024. The main focus of the Budget is focused on the fiscal consolidation and nominal economic growth projection, while no big policy changes are expected as of now.
The travel and tourism sector is also considered to be one of the crucial economic drivers of the Budget with contributions around 5.8 percentage to India’s GDP and expected to reach the target of $1 trillion by 2047, according to government plans.
As per media reports, the tourism sector is also expected to contribute $250 billion to the country’s GDP by 2030, which can generate employment for 137 million individuals. In such case, leading experts from the tourism and travel industry is expecting certain bonuses from the upcoming Interim Budget of 2024, to turn India into a destination of choice.
There are expectations to develop schemes that encourage domestic tourism to offset the impact of the international travel restrictions. Incentives for hotels, resorts, and travel agencies that may aid in promoting the local destinations.
Income tax levels are expected to tune down to boost the disposable income, annual LTA exemptions for domestic tourism, and standardizing TCS at five percent on foreign travel packages. A Budgetary support is expected in travel sector to integrate advanced technologies in the sector. Investments in digital platforms, contactless services and smart tourism initiatives.
Expert recommend to initiate GST input credit for inbound and domestic tourism, centralizing issues faced by single assesses in multiple states and simplifying compliance mechanism. The travel and tourism industry also advocates for removing the TDS (Tax Deducted at Source) on automated bookings in order to align with the government’s commitment to ease business and digital adoption.
Financial aid packages tailored for the tourism and travel industry is high in this Interim Budget. Subsidies to aid businesses in recovering from the prolonged impacts of the Covid 19 Pandemic was also expected.
Budgetary allocations for the global marketing campaigns for promoting tourism in the country is also on the list of expectations. Strategic promotion for attracting the international visitors to regain the sector’s momentum is expected. Promotion of sustainable and eco-friendly tourism practices and incentives for businesses that adopt sustainable measures to the safeguard the natural resources are also on the expectation list.
