Chennai: Following consultations with the stakeholders in the travel, tourism and hospitality sectors in the country, the Federation of Associations in Indian Tourism and Hospitality (FAITH), has called upon the Union Finance Ministry to introduce an upper GST rate of 12 per cent to the industry comprising air travel agents, business exhibition services, hotel and hospitality services, etc.
It also sought similar rate for the tour operators, rent a cab & vacation ownership considering strategic forex, employment, economic and GST rationale and rates for tourism, travel & hospitality sector of India.
This umbrella body representing tourism industry associations, which sought a rationale in introducing GST in the tourism industry, suggested the upper limit of 12 per cent for the Hotels & Hospitality and Vacation Ownerships, and recommended continuation of presumptive rate on the income on air travel agents and keep the GST at 1 per cent or less.
For tour operators, FAITH suggested a presumptive rates mechanism of GST at 1.2 per cent considering difficulty of getting GST input credits from unorganised sector and the burden of compliance of registration with different states. Tour operators selling outbound from India, should be exempted from GST since provision of services are out of India. Also the same yardstick could be applied for business exhibition selling outbound from India as the provision of services are out of India.
It recommended a GST rate of 5 per cent closest to the current rate or 12 percent maximum for rent a car besides a special GST exemption on FOREX for tour operators, hotels and businesses earning Forex.
