The Federation of Associations in Indian Tourism and Hospitality (FAITH), has appealed to all Chief Ministers to come up with a State-specific package.
FAITH, a group of 10 national associations representing the tourism, travel and hospitality industry of India, said on Wednesday all 28 States were set to lose tourism as an industry.
The members said foreign and domestic tourism in each State has been hit severely for 2020-21. The travel trade estimated losses in excess of eight billion domestic tourists, over 10.5 million foreign tourists and six million plus NRI tourists. “Each foreign tourist has a multiplier effect of 2.8 times across States, hence, 10.5 million foreign tourists lead to over 28 million foreign tourists footfalls,” Jay Bhatia, vice-president, Travel Agents Association of India (TAAI), a FAITH member, said.
In an appeal to Chief Ministers, FAITH asked for a complete waiver of all fixed electricity and other utility charges, and excise duties for FY 2020-21 without any penalties and a renewal of all licenses, permits, permissions without any charges or penalties.
The States were also asked to refund the GST collected from all travel agents, tourist transporters, hotels, tour operators, restaurants and any other tourism, travel and hospitality enterprises for FY 2019-20 to help manage their working capital crisis. This amount can be paid back in subsequent years interest free and without any penalties. Additionally, States were asked for a complete waiver of any other taxes, fees, cesses or levies such as property tax or inter-State tourist transport taxes levied on the tourism, travel and hospitality industry.
As per an analysis by FAITH, the COVID-19 pandemic has jeopardised all top performing foreign source markets for tourism, such as U.S., Canada, U.K., Germany, China, Japan, Singapore, Russia, Italy and Spain. In a statement, FAITH said the inter-State domestic season, over 60% of which which falls between April-July, has collapsed for FY 2020-21.
The Federation said it had shared with each State their share of domestic and foreign tourists and how most of those footfalls will now not be available for 2020-21. Tourism business has almost completely come to a standstill, it is severely impacted and foreign tourists are not likely to travel before FY 2021-22, the statement by FAITH said, adding that inter-State tourism will also be negligent for the rest of year with stringent travel restrictions and reduced connectivity.
“FAITH has been repeatedly telling all key government bodies that the tourism industry in India first needs to survive, then revive and only then can it thrive,” the statement said.
FAITH also requested the CMs to ask the Union Finance Minister for a complete waiver of income taxes, Central GST, provident fund, employee State insurance and any other statutory taxes, fees, cesses or levies on the tourism, travel and hospitality industry for FY 2020-21.
FAITH also sought the help of State governments in requesting the RBI Governor to increase the moratorium period on loans from three months to the entire financial year, without any penal or accumulated interest and asking the Centre to set up a Tourism COVID-19 fund for 10-year interest free loans, enabling the industry to meet salary costs.
“This could be for a minimum fund size of ₹50,000 crore, which is almost equal to the gross banking credit to Indian tourism, travel and hospitality industry. This will help retain jobs, ensure that businesses don’t go bankrupt, and also protect the principal amount of loan and overall banking exposure,” FAITH said, calling COVID-19 the worst-ever crisis to have hit the tourism industry, bigger than the combined financial impact of 9/11 and economic downturn of 2009.