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India's Budget: Hospitality Gains, Tourism Promotion Falls
1 Feb
Summary
- National Institute of Hospitality to be established.
- TCS on overseas tour packages reduced to 2%.
- Marketing and promotion spends for tourism slashed significantly.
The Indian Union Budget for 2026-2027 includes significant announcements for the travel and hospitality industry. A new National Institute of Hospitality will be established to bridge academia and industry, aiming to create job-ready professionals. Additionally, the Tax Collected at Source (TCS) on overseas tour packages has been reduced to a flat 2%, a move expected to improve traveler liquidity.
Despite an increase in the total tourism budget to Rs 2438.4 crore, the allocation for marketing and promotion has been drastically cut to Rs 3.5 crore from Rs 103.4 crore. This reduction has led to industry concerns about the impact on inbound tourism, with calls for renewed overseas promotion efforts.
Further initiatives include developing 15 archaeological sites into cultural destinations, creating ecologically sustainable mountain and turtle trails, and establishing a National Destination Digital Knowledge Grid. Seven high-speed rail corridors are also planned to boost connectivity between major cities.
