FAITH seeks industry, export status for hotel, tourism in Budget

In its Budget recommendations, FAITH said the industry status is required for hotels and tourism across all states, as unlike commercial establishments, tourism and hospitality do not just retail but create and produce high-quality service. Power and water utility rates and levies must be at industrial rates effectively, it added.

The Federation of Associations in Indian Tourism and Hospitality (FAITH) on Friday sought industry and export status for hotel and tourism in the country. In its Budget recommendations, FAITH said the industry status is required for hotels and tourism across all states, as unlike commercial establishments, tourism and hospitality do not just retail but create and produce high-quality service.

Power and water utility rates and levies must be at industrial rates effectively, it added. "All existing licences, permits and permissions will be thoroughly examined for redundancies and standardised at a national level.

"There must be a level-playing field in terms of compliances and entry requirements among all sub-segments of conventional and alternative tourism organise the travel industry and protect it from fly-by-night operations," the industry body said. Recently, Maharashtra and Madhya Pradesh governments announced granting the industry status to the hospitality sector, which had been hit by the pandemic.

Meanwhile, FAITH also recommended that an export status is also critical to double India's share of inbound tourism to 2.5 per cent in five years. It is key to treat at par foreign exchange (forex) earning members of tourism, travel and hospitality under export and deemed the export status to promote forex earnings, it said.

It is important to make available the deduction in respect of earnings in convertible foreign exchange to all the tourism and hospitality units earning, it said. Tourism forex earnings should be effectively zero rated for GST (goods and services tax), it added. Meanwhile, the industry body recommended to set up a Global MICE Bidding Fund of Rs 500 crore to double India's MICE (meetings, incentives, conference and events) share to 2.5 per cent of the global MICE size of USD 800 billion.

FAITH also sought the creation of a structured global awareness of multiple Indian tourism verticals corpus of least Rs 2,500 crore for global branding budget for three segments — MICE, adventure, Heritage, under the Incredible India. "This will involve comprehensive global focus on creating segment brand ambassadors, country-wise customised content, mass and social media buying and significant creatives," the FAITH recommendation added.

FAITH said that in the post-COVID-19 normal, each of the Indian mission abroad should be activated with tourism resources for enhancing Indian tourism brand and sales distribution. It recommended the complete abolition of 18 per cent GST category for hotels above room rates of Rs 7,500 and merge it with the 12 per cent GST category.

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