Sahay to meet PM Thursday for tax reduction in tourism sector

New Delhi, Jun 22 (PTI) Indian Tourism Minister Subodh
Kant Sahay will meet Indian Prime Minister Manmohan Singh
Thursday to seek his intervention in reducing taxes in the
tourism sector.
Sahay along with senior officials including four
secretaries from the Ministries of Finance, Civil Aviation,
External Affairs and Surface Transport will meet Singh to
ensure rationalisation of the tax structure for development of
the tourism sector in a coordinated manner with the
involvement of all ministries concerned.
"Currently the taxation on tourist packages is about
27 per cent which include luxury tax, services tax, road tax
and air ticket tax in the country which is one of the highest
in the world," said a senior Tourism Ministry official.
There is a constant demand for reduction of various
taxes in the tourism sector as the higher tax structure is
adversely affecting the industry, he said.
Sahay will also seek significant enhancement in fund
allocation for the sector.
Besides senior officials, a delegation of stakeholders
in tourism including hoteliers and tour operators will also
accompany Sahay to seek the PM's intervention to give a boost
to the tourism industry in the country.
The Tourism Minister will make a presentation of a
blueprint to bring all states on a common platform for the
development of tourist destinations through public-private
participation.
The official said Sahay will seek changes in policy
relating to development of tourism infrastructure and will
also emphasise on a competitive tax regime both at Central
and state levels.

The travel and tourism sector had contributed 5.92 per
cent towards the GDP and 9.24 per cent towards employment
generation in 2007-08. It is estimated that there were 49.8
million tourism-related jobs in 2007-08.
A senior Indian Tourism Ministry official said the
need of the hour is to attract more foreign tourists and to
create more tourist destinations with active private
participation.
In the last few years, the tourism sector has
witnessed significant growth. Foreign tourist arrivals have
reached 5.58 million in 2010 from 3.92 million in 2005.
Domestic tourist visits have also gone up to 650 million in
2009 from 392 million in 2005.
However, though the growth in tourism has been
impressive, India's share in total global tourist arrivals is
quite insignificant.
While China had 5.80 per cent of the world's tourism
arrivals in 2009, India's share was a modest 0.59 per cent.
Though India has tremendous potential for tourism
development with its diverse natural and cultural richness
providing the basis for a wide range of experience to the
visitors, the major impediment in the sector is unhygienic
conditions at tourist destinations, the official said.
"The Ministry plans to run various campaigns through
state participation to maintain hygienic standards at tourist
destinations," he said.