FAITH alerts GST committee on draft GST law

first_imgFederation of Associations in Indian Tourism & Hospitality (FAITH) has sounded the GST Commissionerate and the Revenue Secretary to provide an amendment under Section 2 (44) c to the tourism and hospitality industry. Section 2(44) c, under the draft GST model law describes an export service as one which is rendered abroad.FAITH has put forward the rationale that tourism services to foreign exchange paying tourists can’t be rendered abroad as all our destinations are within India and it is an intangible product. Hence, an exception needs to be provided in the law itself to the tourism and hospitality industry.Once tourism and hospitality is classified as an export service, FAITH will request the GST council for a zero percent rating of GST on tourism and hospitality exports. This will make our tourism industry extremely competitive globally and remove the uncompetitive 18-25% indirect taxation.FAITH will also ask the GST council for a below 10% GST rating on domestic tourism. This is in line with global practices where the introduction of GST has seen tourism GST kept at less than half the standard rate of GST.Implementation of both of these recommendations have the potential to spur our tourism forex earnings to $ 30-$35 billion from 13-15 million foreign tourists and has our domestic tourism to Rs 1.8- 2 billion domestic visitations. This could double the employment induced by tourism to Rs 9 crore jobs from Rs 4.5 crore jobs.FAITH since the past six weeks has begun an aggressive campaign to make the policy markers aware and has reached out to all the Chief Ministers, Finance Ministers, Tourism Ministers, Chief Secretaries, Finance Secretaries and the Tourism Secretaries of all states, apart from the GST Committee, the GST empowered Ministers, the FM & the PMO.FAITH has also shared their concerns with the Tourism Minister and Secretary, who have promised to personally deliver the GST recommendations to the Finance Minister.last_img read more