Budget 2023: international tour packages to get costlier; more focus on border tourism

Finance Minister Nirmala Sitharaman presented the Union Budget 2023 speech on February 1, and announced that the government has increased tax collection at source for overseas packages.

She added that the TCS (tax collection at source) has been increased from 5% to 20% for overseas tour packages.
Although some industry leaders opined that this will hit the tourism industry hard, there is a catch and that this tax collection at source is for the tour packages above Rs 50 lakh. An industry expert stated that if we look at it from another point of view, then in a way it is likely good and promotes domestic tourism, as there is a lot more demand for domestic packages than international ones. He further added that there is also a possibility that high cost tour packages can now be split into multiple travel plans by tour operators and travel agents.

The Finance Minister in her speech added that the country offers immense attraction for domestic as well as foreign tourists, and that there is a large potential to be tapped in tourism. She reinstated that this sector holds huge opportunities for jobs and entrepreneurship for youth in particular.
As reported earlier, the government has already launched schemes like Swadesh Darshan and Dekho Apna Desh.

So, here are the main highlights about budget announcement 2023 for travel and tourism:

• Steps will be taken to promote tourism at border villages.
  
• 50 tourist destinations will be selected, and developed as a whole package for domestic and international tourism.
  
• Government will also set up a unity mall, in state capital or tourist spots, or monuments, to promote the ‘One District, One Product’ scheme, which will help promote GI products and other handicrafts of the states.