Reduce luxury and service taxes on tourism that account for 40–45 per cent cost of the average tour package for foreigners, industry chamber Ficci has demanded ahead of the Great Indian Travel Bazaar-2010, starting April 11.
The Great Indian Travel Bazaar, the biggest pan-India travel show, focusing on inbound tourism and business-to-business meetings between foreign tour operators and Indian sellers, will be kicked off in Jaipur on April 11.
About 230 foreign tour operators from 49 countries and 176 sellers of the Indian tourism product are expected to attend the show, the chamber said.
"Luxury and service taxes account for about 40–45 per cent of the total cost of the average tour package for foreign tourists. These taxes should be reduced to 15 per cent of the total cost," it said, adding reduction in these taxes would provide a boost to inbound tourism segment.
Foreign tourist arrival in 2009 was down 3.3 per cent to 5.11 million, from 5.28 million in 2008.
Ficci has also suggested that though most hotels have taken adequate security measures after the Mumbai terror attack, they are still susceptible to automatic weapon attacks. "Thus, third-party security agencies should be hired to ensure safety at hotels," it has suggested.
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After the Mumbai terror attack in November 2008, there was an approximate 15 per cent decline in the number of international bookings.
The industry body also said the government needs to relax entry restrictions in special-permit regions such as the Andaman, the Lakshadweep and the Northeastern states to attract foreign tourists.
The tourism is one of the largest services industries in the country. In 2008, it accounted for 6.23 per cent of GDP and 8.78 per cent of total employment generated in the country.