Budget 2021 expectations from hospitality industry: Reductions, exceptions, zero rating GST and income tax credit for domestic travel

Union Budget 2021-22 Expectations for hospitality industry: Never before have such great expectations across sectors been so pinned on the Union Budget, with a rising optimism amidst challenging times. Clearly. Budget 2021 expectations from the travel and hospitality industry are soaring.

Now that the country has witnessed the travel trends during festive weekends last year, several factors such as the rising young population, latest travel trends including staycations and workcations have contributed to the upward trajectory of domestic travel seen so far.

Hospitality Industry Budget expectations

Third generation hotelier Amruda Nair is of the view that tourism can play a pivotal role in creating employment and it contributes to almost 10 percent of the GDP. Her Budget expectations include, “Policy changes that encourage domestic spend within the country, financial aid to the hotel and restaurant biz and investment in infrastructure.”

According to Sarvesh Chaubey, Chairman, The Biryani House, “The COVID-19 pandemic and resulting restrictions on domestic and international travel, and economic activity, are having an unprecedented impact on the F & B industry. The government must take relief measures to curtail the damage that has been done.”

Little things can add relief to the restaurants that have been shut down with almost no hope of opening soon.

“Uncertainty on the jobs is yet another reason for the reluctance of people to head to their favorite restaurants or travel,” The Biryani House’s chairman tells Financial Express Online.

Measures for reviving domestic tourism is another area that the hospitality industry is keenly waiting for.

“Spending with GST registered domestic agents as well as hotels needs to be encouraged by offering income tax credit for domestic travel. This will not only prevent leakage to competing destinations but also increase the market penetration within India and reduce the dependency on foreign tourists. For Indian entities to benefit from domestic travel, it will be equally important to give local players an advantage. Reductions, exceptions and zero rating GST for domestic travel, tours and MICE is the primary ask from the hotel and restaurant industry,” Amruda Nair tells Financial Express Online.

Budget 2021 expectations from hotels, restaurants: Blueprint for revival

As weekend getaways are becoming a family favourite, stepping up measures to boost domestic tourism revival is key.

Amruda Nair sums up the Budget expectations from the hospitality industry as follows, “The blueprint for revival has to cover every element of the tourism eco-system in order for the multiplier effect to come into play, with stimulus for aviation, tourism, travel, hotels and restaurants in the form of relief in regulatory requirements, statutory dues, licenses and permits at a state-level.”