The indirect impact of higher goods and services tax on the hotel industry i.e. 28 percent which is the highest GST slab rate making it a difficult industry to deal with other aspects of business in India.
In the recent reports, it is suggested that most of the medical tourism business has been lost due to this higher GST rate on the hotel industry. The logic being the patients having to stay in India now also suffers from higher hotel tariffs now.
The medical tourism is diverting towards the China and Thailand due to the cheaper hotel options as well as equally capable medical assistance as provided by the Indian medical industry.
According to the reports and statistical data from the tourism ministry, there has been a downfall in the number of medical tourist coming from Kenya, Nigeria, Afghanistan, Uzbekistan etc.
According to the chief director of tourism ministry, the major cause for the loss of medical tourists is that of applicable GST on the hotels in India, having highest 28 percent GST slab rate.
Although the tax rate was 18 to 19 percent earlier which has now been declared up to 28 percent in the GST regime on the hotel industry, which is seriously making a big hole in the pockets of the hoteliers and tourists alike.
