WE HAVE MOVED: NEW ADDRESS
16 North Road, Dunkeld Court
Dunkeld West.
Email: info@azuretravel.co.za
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| IMPACT OF INDIA UNION BUDGET 2011-12 dated March 2011 |
This is to inform you that Government of India has announced an increase in Service Tax on Air Travel and has included Hotels and restaurants under the ambit of Service Tax. This is for the period 1st April’11 to 31st March’12. Following would be the impact :
1. Air Travel: These increases are effective for travel on/after 01April 2011 as detailed below:
| A |
Domestic Travel Ticket |
From INR 100 to INR 150 (approx increase $1.1) |
| B |
Domestic Travel Ticket |
10% Standard Rate |
| C |
International Travel Ticket |
From INR 500 to INR 750 (approx increase $5.6) |
2. Accommodation provided by Hotels or any other similar establishment in excess of declared tariff of INR1000 (approx $22.2) per day will attract Service Tax. The tax rate is 10.3% but the government has allowed an abatement of 50%. Thus the effective rate would be 5.15 %.
3. Services provided by air-conditioned restaurant that have license to serve liquor will also come under the Service Tax ambit. The tax rate is 10.3 %. However, the government has allowed an abatement of 70% and thus the effective rate is 3.09%.
The above-mentioned taxes are over and above the present taxes. You would appreciate that any incremental taxes are beyond the ambit of our Contracts with Hotels and Air Lines. Hence this impact cannot be absorbed or negotiated by us.
Since the aforesaid would increase our tour costs, various efforts are being made by industry experts to persuade Government on the probable adverse impact on tourism industry. We will keep you updated on any further developments in this matter.
We appreciate your understanding.
*Considering $1= INR 45
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