Tour operators’ body urges govt to end cascading impact of multiple taxes
January 11, 2021
Wants govt to treat tourism sector on par with IT industry
The Indian Association of Tour Operators (IATO) has urged the Centre to take measures to solve the challenges of multiple taxation faced by tour operators.
It demanded to either lower the GST charged from tour operators or allow input tax credit and end the cascading impact of multiple taxes.
“The tour operators suffer from multiple taxation at different levels as they offer multitude of services ….for which they have to pay GST at about 18-23 per cent. Further, on their total billing, they pay GST at the rate 5 per cent (without input tax credit). This compares unfavourably with neighbouring countries where GST rates of about 6-8 per cent are charged from tour operators,” IATO said in a statement.
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Illustration by Nilanjan Das
Finance minister Nirmala Sitharaman will present Budget 2021 in the backdrop of an exceptionally chaotic 2020. In Q1 of FY21, India s lockdown-struck gross domestic product (GDP) contracted an unprecedented 23.9 per cent, the worst among major economies. When the economy opened up, pent-up demand pushed up consumption, but GDP still shrank 7.5 per cent in Q2. And even though the RBI predicts that the economic shrinkage is over and GDP will grow 0.1 per cent and 0.7 per cent in third and fourth quarters, respectively, FY21 is destined to go down in history as India s fifth recession.