Will the Indian traveller miss the bus in Budget 2015?

By | February 27, 2015

Airplane in Sunset

If you thought only tax payers, businessmen and various chambers of commerce had a budget wish list, you are missing the wood for the trees. Travelers are a key segment of the tax paying population who are waiting for the upcoming Union Budget with bated breath. Since the Indian travel market alone is estimated to be over $50 billion, it is imperative that the government gives due attention not just to the travel and tourism industry as a whole, but to the wish list of the individual traveler at the micro-level as well. Here are some of the budget expectations the average Indian traveler would have from the Union Government.

Focus on Security and Cleanliness

With Mr. Suresh Prabhu not announcing any new trains yesterday and coming out with an “apolitical” Railway Budget, a lot of taxpayers’ money is expected to be left on the table which can be put to good use. While India is on its way to become an economic power and boasts of being home to one of the world’s largest railway networks with more than 100000 kms of track and over 7000 stations, the trains that thunder down these tracks and the nodal stations dotting the country are still dirty and messy, putting off tourists including both domestic and foreign tourists. Ditto with the innumerable bus terminals, cab parking bays and auto stands that pepper the length and breadth of the country. Since the Prime Minister has focused so much on this during cleanliness campaign under the ‘Swacch Bharat Abhiyan’, it is seemingly a fair ask to have a section of the Budget dedicated to hygiene and cleanliness of all points of contact between the traveller and the travel industry.

Adequate Women’s Safety Norms

Women’s safety is a long-standing demand of travellers as the number of crimes against women has been on the rise in the country in recent years. Many foreign travellers are eager to come to India but the lack of security for women travellers makes it difficult for many to travel here alone. The introduction of a beat guard policing system dedicated for women travellers is the need of the hour along with other important steps that can assuage concerns of the fairer sex.

Removing Travel Agents from the Ambit of Service Tax

There is a general expectation in the air for removing travel agents from the ambit of service tax as it is resulting in higher travel costs, threatening to dampen demand in the tourism sector. Since travel agents also assist in hotel reservations and taxi services, charging service tax is exponentially increasing the average cost of holiday and travel.

Since travel agents are a ubiquitous cog in the wheels of the tourism industry, the withdrawal of service tax can go a long way in ensuring that the tourism business takes off in the new financial year with a flourish and faces lesser headwinds. Representatives of various travel agents have already met the Finance Minister and presented their proposal for service tax exemption. There is also a case for service tax exemption for religious tourists like those seeking tickets and reservations from places Amarnath Yatra, Haj and other places of religious significance. This can generate additional goodwill for the Modi government which is presenting its first full Budget.

Allowing LTA on Overseas Travel

At present, employees are allowed with the benefit of a Leave Travel Allowance (LTA) only on domestic travel. Since the average income of Indians is now higher than ever before, and more and more people are packing their bags for exotic destinations abroad, there is a strong case for allowing LTA benefits for international travellers as well.

South Asian countries are offering many exciting travel packages specially designed for Indian tourists. Sri Lanka, Bangladesh, Bhutan and China among other locales have become attractive as vacation destinations. If LTA allowance is made available for international travel, it can mean a huge surge in the overseas travel market, fuelling demand and more tourism revenue, apart from keeping our foreign exchange more liquid.

Come this Saturday, the 28th of February 2015, the travel industry will know whether the average Indian traveller is poised to ride the next financial year in style or would have missed the bus once again.

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