WHAT IS THERE IN THE BUDGET -2023 FOR THE TOURISM SECTOR?

 BY ROBIN GHOSH

( FORMER CHIEF ECONOMIST, BENGAL CHAMBER OF COMMERCE AND INDUSTRY)

KOLKATA, 3 FEBRUARY 2023
Budget is fundamentally an accounting exercise. But our budget documents also project policy initiatives of the Government. It describes some outline of priorities of Government in specific sectors, macro initiatives, specific projects, tax rebates and incentives.
Budget 2023 placed by the Minister of Finance has some postive focus on Tourism Sector. And at the same there are negative overtures.

Let us count the positives:
1 .Tourism Sector to be promoted on ” mission ” mode.
2 .50 Destination will be promoted and developed as a complete package.
3 .50 Destinations will be so planned that it delivers positive ” experience ” to tourists and all information regarding physical connectivity, virtual connectivity, tourist guides, food streets, security shall be available through an app.
4 .Focus on green tourism, digital tourism, skilling of the hospitality sector, support to Tourism related MSMEs will continue.
5 . Leveraging G 20 presidency as a booster to promote India as a global tourist destination .
6 . Public – Private partnership will be encouraged.
7 .50 additional airports will be revived for regional connectivity.
8. Border tourism will be given special priority.

Now let us observe the negative impacts :
1 .Increase in TCS( Tax collections at source) on overseas tour packages from 5% to 20% is not only increase the upfront cash outflow for customers but will give an unfair advantage to foreign based online travel booking platforms.
2. There is no inkling about rationalization of GST on Tourism industry, exemption of GST on foreign exchange earnings.
Technically speaking, my quick view is that the inherent design embedded in the budget for Tourism sector has been:
1 . Development of infrastructure
2 . Development of skill
3 . Development of new tourist circuits to promote domestic tourism.
4 . Use of digital technology in Tourism sector.
Essentially, the policy initiatives are in line with National Tourism Policy.