Travel industry start twitter campaign against Tax on tour packages

Forum Gandhi Mumbai | Updated on March 12, 2020


Indian travel industry players have started a Twitter campaign called ‘save the travel industry’, urging the government to roll back the Tax Collected at Source (TCS) on outbound travel packages.

The Union Budget this year introduced a change in Section 206C of the IT Act with regards to Tax Collected at Source (TCS), to levy five per cent tax on overseas remittance and sale of outbound packages.

On Thursday, #SaveTheTravelIndustry started trending on Twitter.

“#savetravelindustry Don’t kill the Indian travel industry – let money flow in, not out of India. Save the travel industry, remove TCS. Let the economy grow and earn.” Rukmini Sarkar tweeted.

Travmic Tours & Events tweeted: @travmictours #savetravelindustry For once I wish the government will wake up and see what the travel industry is going through. Save the Travel agents stop the TCS. With everything going on COVID19, TCS will be the last nail in the coffin.

Speaking to BusinessLine, Rupal Shukla, Founder of Tierra Travel said, “This is a collective effort made by the travel industry players to try and save it from dying. With the scare of coronavirus, the industry is anyway in deep trouble.”

BusinessLine had reported that while this would mean greater compliance in the travel industry, it would add as a massive dampener as it could mean that the industry players could pass on the TCS to the customers and make the outbound travel five per cent costlier.

A month ago, Travel Agents Association of India (TAAI) had urged the government to roll back the budget proposal to collect five per cent income tax at source from outbound travellers as this gives unfair advantage to foreign travel firms.

Shukla added, “We pay our taxes, and so do our employees. This regime is going to motive customers to use international websites or pay at the hotel. With this, the government is losing out on revenue and the industry is losing out on customers.”

Loveleen Multani Arun, who runs Panache World in Bangalore, said, “This collective burden of TCS, slowdown, and coronavirus is going to lead to massive losses in the industry. Players like us do not have funding from big investors. We will have to resort to downsizing the number of employees.” Shukla too is considering downsizing.

Meanwhile, no-frill carrier IndiGo on Wednesday had cautioned against a weak quarter due to the impact of coronavirus, and rupee decline. The no-frills carrier has seen a decline of 15-20 per cent in daily bookings on a week-on-week basis due to coronavirus.

The carrier informed the exchanges that it has been severely hit due to the outbreak of coronavirus in January and February 2020.

Published on March 12, 2020

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