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Kon'nichiwa or Hallo? First, pay a tourist tax

From Bhutan revisiting its tourist tax policy to Iceland expanding taxation, here’s a guide to navigating the new era of taxed travel. Interchangeably used with visitor levy or accommodation tax, tourist tax is a fee imposed on travellers by a country to help fund local infrastructure, services and tourism. Mostly, the collected fund is reinvested in the destination but in some cases, the fee can limit and regulate people from contributing to overtourism. DOES THE TAX HELP? "It can be a potent tool in combating overtourism. Thailand's move to collect fees for environmental conservation sends a powerful message about the need for responsible tourism," explains a representative of Conservative Corridor, a specialist group in conservation management, adding, "Similarly, Venice's decision to charge day-trippers €5 per person (to be implemented from 2024) will help steer visitors towards less congested periods.” We're now on WhatsApp. Click to join. THE FLIP SIDE While Bhutan's Sustainable Development Fee (SDF) which levied a $200 charge per person, was hailed as a landmark decision, the policy drastically impacted the footfall of travellers. "Despite lowering the SDF to $100 per person per night, Bhutan still grapples to meet its tourism targets. They are making efforts to counter this and have introduced a significant reduction in airfares as part of its recent initiatives, to drive an increase in flight bookings to and from the Himalayan kingdom," Phuntsho Gayleg, a Thimpu-based guide and local expert. HOW TO NAVIGATE AROUND THE TAX? 1. Before finalising your travel plans, research your destination's tourism tax policies. Different places have varying tax rates and regulations. Most information is available on official tourism websites. 2. Factor in the tourism tax while creating your travel budget. In some cases, the tourist tax can be both a part of the visa fee as well as accommodation. 3. Look for exemptions. For instance, Indian visitors, constituting about 73% of Bhutan's total arrivals, can obtain a special permit via the Bhutanese government's visa portal. They are required to pay a daily fee of ₹1,200 Rs. or $15) for their visit. Accommodations often play a significant role in tourism taxes. 4. Establishments can charge higher taxes for luxury or high-end accommodations and in countries like the Netherlands and Austria, they can sneak into your nightly hostel budget, too. Tourist taxes for Airbnb, homestays and private accommodations are still undefined.

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Kerala Tourism plans to launch microsites for promoting pilgrimage tourism

Kerala Tourism is preparing to introduce a series of microsites aimed at showcasing the state's abundant heritage. The Kerala Tourism is all set to come out with a set of microsites to promote the state’s rich and diverse heritage, highlighting features of important places of worship. As part of this, a microsite that provides a wide range of information in different languages on Sabarimala will be unveiled, a tourism department statement said on Friday. The revamped microsite on the hill-shrine in Pathanamthitta district will have comprehensive information in five languages- English, Hindi, Tamil, Kannada and Telugu. The ₹61.36 lakh project will also feature e-brochures on pilgrimage to the hill-shrine, 160 km north of the state capital, it said. Besides, the site will carry a promotional film, it said, adding that lakhs of pilgrims visit the Ayyappa temple annually and the project is aimed at making their trips hassle-free. The renovated site will provide the pilgrims with additional information on the temples they can visit after worshipping at Sabarimala, their travel routes and the rituals to be followed. YouTube videos will further substantiate the details, authorities said, pointing out that the efforts were aimed at boosting Kerala’s reputation as a major pilgrim tourism state. The site will provide information on not just the routes, but the transport and lodging facilities in the vicinity of the temples, thereby wooing a greater number of pilgrims, it said. The microsite will also show details of the latest information on Sabarimala darshan, the topographical specialities of the hill-shrine, its cultural values and traditions. All these can enable prospective pilgrims to chart their itinerary. The Tourism Department sanctioned ₹61.36 lakh for the microsite on Sabarimala on October 16, after the working group concerned approved the project, the statement further said. Earlier, the department had sanctioned ₹60 lakh for an Augmented Reality Heritage Tour of the famed Sree Padmanabhaswamy Temple in the state capital. The Kerala Tourism is also planning to come out with a microsite on state's Islamic traditions, art-forms, festivals and places of worship, as part of a ₹93.81-lakh digital project that was also approved by the working group on October 16, it said. It has already developed similar packages for the state’s Hindu, Christian and Jewish places of worship. The Tourism Department is aiming at comprehensive promotion of pilgrimage tourism in the state, the statement added.

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Foreign tourists travelling to three NE states to now get easy permits for Restricted and Protected area

Earlier, RAP/PAP was very difficult to get for foreigners visiting Arunachal Pradesh, Mizoram and Nagaland in North East but curbs have been eased for tourists.The Restricted Area Permits (RAP) and Protected Area Permits (PAP), needed by foreigners for travel to three border states of North East, have been eased considerably with very few rejections, Union Ministry of Tourism's Regional Director in North East Anil Oraw said on Sunday. Earlier, RAP or PAP was very difficult to get but the Government of India, which is promoting the North East as a tourism destination, has eased these restrictions, Oraw told PTI.The foreigners need RAP or PAP to visit certain parts of the North East, particularly the border states like Arunachal Pradesh, Mizoram and Nagaland. "Now any foreign traveller can visit these states through organised tours which have to be handled by a local tour operator based in that particular state," he said. The local tour operators will have to do all the facilitation and there is very little rejection of foreign tourists in these states but they have to apply a bit early, Oraw said. The Indian government is also planning to open border area tourism in the next few years as there are hardly any activities or industries in these areas."In a bid to provide more opportunities to people of these areas, the Government of India is planning to open up the border areas with tourists likely to be allowed to go up to four kilometres near the China and Myanmar borders'', the regional director said. The Army has also come on board in this regard, he added. "The Government of India's home, defence and tourism ministries are all on board together to open up border tourism so that the people residing in these areas get more employment," he said. In the meantime, many vibrant villages have been declared in terms of what is unique like the Kibithu village in Arunachal Pradesh where it is said that the sun rays fall first in the country, Oraw said. He also pointed out there was immense prospect for collaboration between Vietnam and India in the tourism sector which currently has a very low inflow but a huge outflow of tourists from India to Vietnam. Among the Southeast Asian countries, Malaysia has the highest inflow of tourists to India, followed by Singapore, Thailand, Myanmar, Indonesia and then Vietnam, he said. "There is a need to bridge this gap and we are encouraging tour operators from Vietnam to come to India, particularly in the North East which has gained immense popularity for domestic tourists in the post-COVID period," Oraw said. People are looking forward to 'green tourism' and the North East has immense potential in this regard, he said. In 2021, domestic tourism in North East had broken all records- with 1.3 crore people visiting from other parts of the country visiting because the region is open, and clean, people are friendly and hospitable, facilities including five-star and other hotels along with homestays are available and there is also abundance of natural beauty, Oraw added.

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British Airways parent IAG, Air France-KLM benefit from bumper summer travel demands

British Airways parent IAG, Air France-KLM benefit from bumper summer as travel got close to pre-pandemic levels and remaining travel restrictions were lifted. British Airways parent IAG SA posted record third-quarter profit, led by strong summer demand for leisure travel on transatlantic and European routes.The group, which also includes Spain’s Iberia and Aer Lingus, reported an operating profit of €1.75 billion ($1.85 billion) for the period. Capacity for the full year is expected to reach 96% of pre-Covid 19 levels.Airlines have benefited from bumper summer as travel got close to pre-pandemic levels and the last remaining travel restrictions were lifted. But the rest of the year looks more challenging, with cost of living pressures in key markets and growing geopolitical difficulties, as the Israel-Gaza conflict adding to the continued closure of airspace over Ukraine. “We’re very mindful of the geopolitical and macroeconomic uncertainty, in particular the events happening in the Middle East,” said Chief Executive Officer Luis Gallego on a media call. “We continue with the forecast that we’ve had for the year and we are monitoring very carefully the situation.” IAG shares rose as much as 4.3% and were 1.7% higher at 8:11 a.m. in London. The stock has gained 17% so far this year. Rival Air France-KLM also reported results on Friday, posting third-quarter revenue, profit and passenger figures that fell slightly below analysts’ estimates. IAG has made progress on a number of fronts as it rebounds from the devastating effects of the pandemic, when its fleet was virtually grounded. The carrier group regained its investment grade credit rating from Standard & Poor’s and BA reached a tentative deal with its pilot which removes the threat of strike action through 2027.

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Strong demand in H2 FY2024 to contribute to double-digit revenue growth for hotel industry in FY2024: ICRA

ICRA expects the Indian hotel industry to report double-digit revenue growth in FY2024, supported by the sustenance of domestic leisure travel, demand from meetings, incentives, conferences, and exhibitions (MICE), and business travel, along with an increase in foreign tourist arrivals (FTAs). The industry has also benefitted from the G20 summit and the ongoing ICC World Cup 2023. ICRA estimates pan-India premium hotel occupancy at ~70-72% in FY2024, after recovering to 68-70% in FY2023. Pan-India premium hotel average room rates (ARRs) are expected to be at ~Rs. 6,000-6,200 in FY2024. While the occupancy is expected to be at decadal highs, the RevPAR is expected to remain at a 20-25% discount to the FY2008 peak. The medium-term demand outlook also remains healthy, supported by a confluence of factors including improvement in infrastructure and air connectivity, favourable demographics, and anticipated growth in large-scale MICE events with the opening of multiple new convention centres in the last few years, among others. The healthy demand amid relatively lower supply would lead to higher ARRs. Larger players would also benefit from revenues/share of profits generated from hotel expansions through management contracts and operating leases. Vinutaa S, Vice President and Sector Head – Corporate Ratings, ICRA Limited, said, “Demand is expected to remain strong across markets in FY2024 as consumer sentiments continue to be healthy and corporate performance is stable. Hotel-specific demand, would, however, depend on location, competition, and other property-related dynamics. Further, domestic tourism would be the prime driver, although FTAs are likely to pick up in H2 FY2024. Mumbai and Delhi, being gateway cities, are likely to report occupancy north of 75% in FY2024, benefitting from transient passengers, business travellers, and MICE events. While Pune and Bengaluru could be laggards compared to other markets, they are also expected to witness significant improvement in FY2024 compared to FY2023. While trailing the FY2008 peak, the ARRs would witness a healthy YoY increase in FY2024. The sharp rise in ARRs of premium hotels also resulted in the spillover of demand to mid-scale hotels.” Sustenance of a large part of the cost-rationalisation measures undertaken during the Covid period, along with operating leverage benefits, has resulted in a sharp expansion in margins compared to pre-Covid levels. The staff-to-room ratio remains ~15-20% lower than pre-Covid levels. Companies have increased their usage of renewable power while pass-through of the cost inflation and strict control on fixed costs increase have also supported margins. Asset-light expansions have been margin-accretive for larger hotel chains. However, there could be some moderation in margins from the FY2023 levels with hotels undertaking renovations and maintenance activities, albeit significantly higher than the pre-Covid levels. ICRA’s sample comprising 12 large hotel companies is expected to report operating margins of 25-28% for FY2024, as against 28-30% for FY2023 and 20-22% pre-Covid. De-leveraging of balance sheets has led to lower interest costs and would support net margins. “ICRA expects the uptick in earnings and cashflows to support the capital structure going forward. The asset monetisations, if any, would largely pertain to non-revenue generating assets. Debt metrics for hoteliers are expected to be better than pre-Covid levels in FY2024. The extent of improvement in return on capital employed (RoCE) would, however, depend on expansion strategy and could be constrained by the high capital cost of new properties owing to increased land and construction cost, in case of asset-heavy expansion. The healthy business accruals have led to improvement in credit profiles in several companies. This has resulted in upgrades exceeding downgrades in FY2023 and YTD FY2024. About 94% of ICRA’s ratings are on stable outlook at present.”, adds Vinutaa. The healthy demand uptick has resulted in a pick-up in supply announcements and the commencement of deferred projects in the last 12-15 months. However, supply, which is expected to grow at a CAGR of 3.5-4% over the medium term, would lag demand. Land availability issues currently constrain supply addition in premium micro-markets in metros and larger cities. Addition to premium hotel supply in these areas is largely on account of rebranding or property upgradation and greenfield projects are largely in suburbs. Sizeable supply announcements are seen in tier-II leisure, business, and religious destinations. There is also an increase in per room construction cost by 20-25%, with cost inflation, compared to pre-Covid levels.

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North East India Festival in Vietnam to promote Act East Policy; to include trade, tourism and academic sessions

The festival, in collaboration with Ministry of External Affairs, seeks to take forward Act East Policy by focusing on trade, tourism, and cultural exchanges. The three-day North East India Festival (NEIF) to promote the Act East Policy will begin in Ho Chi Minh City on Friday with stakeholders from both India and Vietnam holding discussions on bilateral trade and tourism. The inaugural session of the third edition of the festival will be hosted by the Consul General of India Madan Mohan Sethi, NEIF's Chief Organiser Shyamkanu Mahanta told PTI. It will bring critical stakeholders from both the countries, Mahanta said. The festival, being held at the 23rd September Park here, is aimed to establish deeper ties between India and Vietnam through business, art and culture, he said. The Consul General said that the festival constitutes a diverse array of activities, including trade, tourism and academic sessions that will facilitate business and academic linkages between India and Vietnam. "This event exemplifies our collective endeavour to bridge North East India with Vietnam through trade, tourism and people-to-people exchanges, aligning with the Act East Policy of Prime Minister Narendra Modi," Sethi said. The festival, organised in collaboration with the Ministry of External Affairs, seeks to take forward the Act East Policy by focusing on trade, tourism, cultural and academic exchanges, Mahanta said. The DONER (Development of North Eastern Region) ministry will organise a meeting on tourism and facilitate interactions between tour operators from North East India and their Vietnamese counterparts, he said. A meeting on trade will also be held under the aegis of Invest India to showcase North East as an attractive destination for investments, tourism and bilateral trade, he said. A people-to-people exchange meeting will also be held to offer a platform for scholars, academicians and historians from North East India to engage with their Vietnamese counterparts, he said. "NEIF has successfully opened up new vistas in India's relationship with South East Asia, thanks to the substantial support of the government of India", Mahanta said. The overwhelming support from the state governments of North East region has also helped in organising the country's biggest event in South East Asia and "translate Prime Minister Narendra Modi's vision on Act East Policy into action", he added. 'Incredible India' destinations, textiles, state-specific exhibition zones representing various Northeastern states, tea industry among others. The event's entertainment line-up will feature an array of cultural performances, including colourful folk dances from North East India, rock bands from both countries and fashion shows by designers from the region. Leading designers Sanghamitra Phukan, Bidyut-Rakesh, Manjushree Saikia, Yana Ngoba, Hasina Kharbih, Iba Mallai among others will showcase their works. The fashion show will feature models from Vietnam, Mahanta said. Musical performances by TaFMA (Task Force for Music and Arts) from Nagaland, The Fantastic Company (TFS), Bright Lights, guitar prodigy Imnainla Jamir, Trance Effect, K L Pamei and the popular band from Meghalaya 'Summersalt' will also be held on the occasion.

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