Thread by @LoveleenArun

1) Long thread on why the Travel Industry in India is desperate to have the #TCSTax reconsidered....
#savetravelindustry

2/ The #travelindustry is made up of Hotels, Airlines, Travel Agents - who may specialise in Inbound or Outbound #Tours. Apart from a few big cos, most are small, owner led outfits with 8-10 employees servicing loyal clients
#savetravelindustry

3/Contrary to what is general perception, the margins in this business have shrunk to dismal levels for this extremely HR-heavy industry whilst expenses for fixed costs have gone sky-high
#savetravelindustry

4/Typically, a travel-agent selling an outbound package works with 10% margins on hotels, trains, guides, transport which is the commission component. Bank charges for remittance, Fx fluctuations etc means its actually closer to 8%
#savetravelindustry

5/Competition grows everyday as there is an onslaught of online booking engines, no entry barriers into the trade, funded sites working on wafer thin margins. This has burdened the typical travel agent business very harshly
#savetravelindustry

6/ 5% GST was levied on Tour packages and that brought down the margins even more drastically as the final payable cost is compared with online rates by internet-savvy consumers. There are no compliance laws to stop unethical practices...
#savetravelindustry

7/...by booking engines as there are in EU for instance "Only one room left for your dates" for instance ...Add to this huge costs for training staff, upgrading technology, research & travel...earnings leave no scope for innovation
#savetravelindustry

8/ Indians are one of the most coveted consumers for global tourism and the numbers are rising. However, this is not benefitting the indian travel agent who has toiled to remain relevant & invested in becoming a good advisor.
#savetravelindustry

9/ Whilst a diligent small travel agent will remit payments thru authorised banks/Fx cos complying with several procedures, a customer can simply swipe his credit card for 3 different hotels, book transport etc and bypass the agent
#savetravelindustry

10/ Many of the booking engines even work on the model of "book online, pay at hotel"....where does the compliance even come in to play in this case?
#savetravelindustry

11/From 1st April, as per #budget2020 a new 5% TCS (Tax cut at source) is to be levied on all outbound Tour Packages in addition to the existing 5% GST!! You dont have to be a rocket scientist to realise that it means negative margins!
#savetravelindustry

12/The rationale behind this tax is trying to net the non-income tax payers who have been going on Intl jaunts. The reason is appreciated. Further, TCS is also reclaimable in IT returns. But if there exists an alternate....
#savetravelindustry

13/...which ones of us would like their capital stuck for a year? It is this uneven playing field compared to the Online Travel Agents which are not even based in India, that the Travel agents are worried about!
#savetravelindustry

14/ #COVID19india #COVID19 has played havoc with our industry. Most companies are already on the brink of closure and have been unable to pay salaries to their employees. The near future is very bleak.
#savetravelindustry

15/ In this absolutely abysmal scenario, It makes no sense to burden the industry further. This #TCSTax needs to be rolled back...or atleast deferred indefinitely for now till normalcy returns and the economy does better
#savetravelindustry

16/ This community works hard to create happy memories for our customers around the world. I know of many of my colleagues who have worked day and night to help their clients. We appeal to every person who has enjoyed the services...
#savetravelindustry

17/...of a travel agent to help us create awareness of this acute situation....HUG A TRAVEL AGENT TODAY! God knows we all need it!
And @FinMinIndia please do reconsider #TCSTax for now!
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