Reduce percentage of TCS and simplify TCS application on foreign tours: Mahendra Vakharia

Sharing some of the pain points that he seeks clarity and consideration on from the FM , in the upcoming budget, Mahendra Vakharia, Executive Committee Member / Immediate Past President – OTOAI & MD, Pathfinders Holidays, shares the below:

• Make the GST application and adjustment of Credit rule simpler for services rendered to client based in different state, service purchased from different state and invoiced from different state….
• Allow adjustment of input credit of GST for International Holidays
• Reduce the percentage of TCS and Simplify the application of TCS on Foreign tour packages if you are unable to completely abolish TCS on International Packages – especially when booked from a tour operator / travel agent as it is not creating a level playing field for the Travel Agent charging TCS against  a Foreign registered online portal which is allowed to process bookings without charging TCS. This is totally and completely demoralising in defeating the rule of “Make in India” and favouring the foreign operators instead of the local travel agents.
• Interpretation of TCS rule is also very complicated and should be made very simple – both for the client and the travel agent thereby reducing the liability of the Travel Agent for non compliance due to ambiguity of the law and its implementation
• In fact from the day one when TCS was introduced the request from Industry was to abolish this TCS rule for International Tour Packages. This rule is not giving the local travel agent who is generating employment, paying income tax, paying GST,  a level playing field in comparision to the online Foreign Travel Portal who is not paying income tax, not generating employment, not paying GST and taking away the business of Indian Travel Agent.
• Introduce some sort of licensing and recognise it with Industry Status….
• Ease of remitting funds without PAN from foreign clients based out of India, who are booking an International holiday through an Indian Travel Agent,  transferring money to the Indian Agent in his regular bank account from which the agent in turn has to remit it out to the destination partner for services booked