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One India One Tourism: Union Budget 2022

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Published on March 8, 2022. EST READ TIME: 3 minutes

Coronavirus left no corner untouched and negatively affected each one to a great extent. Tourism has forever been a part of people’s lives and it is also, as important as other aspects of life. This pandemic pulled back and locked people in their homes. They had no travelling options left as it could put lives at stake. The Government of India, like the government of every other country, was forced to put restraints on the movement of people and this badly hit the travel and tourism and the hospitality business to an extent that some even had to shut the business. With no travelling, even travel insurance had almost stopped and also experienced a major setback.

The Union Budget of 2022-23 has brought with it a lot of expectations and a hope that things could be fixed and that the economy will see new dawn again. In this race of hope, the tourism department is a contender as well. The Travel Agents Association of India (TAAI) asked for a One India One Tourism approach in the 2022 Union budget. This association is also expecting the government to waive off the fees for e-visas for all tourists coming in the year 2022-23. This will help in reviving the export earnings brought in by tourism.

Aviation Turbine Fuel, the aircraft fuel, is also demanded to be made cheaper. It is quite obvious that with cheaper fuel, the cost of flying will also come down leading to more tourists. All these may collectively lower the burden on the tourism department that was imposed during the pandemic period.

Key Takeaways for the Tourism Industry from the recently concluded Union Budget 2022

The Union Budget 2022 is expected to act fair to various industries including the tourism department. Here are some of the key highlights of Union Budget 2022 that might help you understand the budget in a broader aspect:

1. Improved Cash Flows

Some firm measures will be taken to improve cash flows and reduce the working capital on existing MSMEs, SMEs and startups.

2. Taxation

Along with this easy credit, a reduction in the GST rate and income tax will be added. Not only this but the tax collected at the source (TCS) will also be terminated.

3. Upgrading Technology

Creating a fund for the adoption of the latest technologies for use in this industry. For upgrading technology, the revival of credit linked capital subsidy scheme (CLCSS) will also be done.

4. More Money for Tourism

The budget also sought double expenditure allocation for the tourism ministry. This will enable the global reach out of tourism and also supports the revival of income tax travel credit for the citizens of India as well the Indian companies, this will support domestic retail and domestic meetings, incentives, conferences and exhibitions.

5. Security for Travel Agents

TAAI also sought some guarantee or a mechanism that can help in securing the travel agents money.

6. Cheaper Aviation Turbine Fuel (ATF)

TAAI has also demanded cheaper Aviation Turbine Fuel (ATF). It will automatically reduce the cost of travelling and welcome more tourists.

What is One India One Tourism?

To revive the pandemic-hit sector, One India One Tourism is a scheme demanded by TAAI (Travel Agents Association of India) where they are seeking recovery from the losses incurred by the tourism industry due to SARS Covid-19. It is expected and demanded by the TAAI that there be one tax structure for the tourism department to regulate taxation easily. Secondly, they also seek a lower price of ATF (Aviation Turbine Fuel) so that the overall cost of travelling can be reduced and more and more people step up for travelling and tourism. Thirdly, the TAAI has also demanded through One India One Tourism that the fees levied on e-visas shall be waived off so that more foreign tourists head up for tourism in India which will lead to more profits. In a nutshell, this scheme will be a reviving step for the tourism department of India if implemented as expected.

How will it boost the industry?

The tourism sector accounts for about 7.3% of the total GDP of the country. Around 2.7% of the people are getting employment due to this industry which is highly labour intensive and provides work for skilled, unskilled and semi-skilled persons. All these will get a boost if the tourists coming will be in large numbers. The One India One Tourism approach has a plan to waive off the fees for e-visas, this will invite more tourists to the country. Also, this plan is expected to be inclusive of one tax structure as well which will further remove several complexities of tax. All these in return will lead to more employment and more tourism export earnings.

Conclusion

Battered by coronavirus, the Indian tourism industry surely slowed down for a while however, it will soon come out of this shattering phase. Tourism has been the most essential means of entertainment for people across the globe and India being a hub of tourist places will soon recover from the losses and see new heights. One India One Tourism is yet a drastic and positive step that is very likely to change the face and shape of Indian tourism. It is expected to make tourism cheaper and easier for the tourists and more profitable for the industry. The Union Budget 2022 plans to provide a better and more developed infrastructure to help boost the experience of tourists even at small and less-known Indian destinations. Speedy implementation of development projects will surely tap the potential of the budding industry. Thanks to mass vaccinations, milder covid cases, and awareness about travel insurance, the chances of the tourism industry bouncing back are very bright.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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