Indian Prime Minister Denies Reports of Tax on Foreign Travel

Prime Minister Narendra Modi on Friday strongly dismissed reports claiming that the Centre was considering imposing a cess or tax on foreign travel, calling the speculation “totally false”. The clarification came after a report by CNBC-TV18 claimed that a proposal to levy a cess, tax or surcharge on outbound international travel was under discussion at the “highest levels” of the government. Responding directly to the media outlet’s post on X, Modi said there was not even an “iota of truth” in the report. “This is totally false. Not an iota of truth in this. There is no question of putting such restrictions on foreign travel,” the Prime Minister wrote. He further asserted that the government remains committed to improving “Ease of Doing Business” and “Ease of Living” for citizens. The report came days after Modi appealed to citizens to cut down on non-essential foreign travel, reduce fuel consumption and refrain from purchasing gold jewellery for a year as part of efforts to ease India’s import burden amid the ongoing Gulf crisis. The global energy market has come under severe strain following Iran’s closure of the Strait of Hormuz, a critical route for global crude oil and liquefied natural gas shipments. The disruption has pushed crude prices above $100 a barrel, intensifying inflationary concerns worldwide. The impact is already being felt in the travel sector, with airlines hiking fuel surcharges and international travel becoming costlier due to rising airfare, transport and accommodation expenses. India’s tourism industry, currently valued at nearly $231.6 billion and supporting close to 10% of the country’s workforce, could also face pressure if outbound travel slows. Industry projections estimated India’s outbound tourism market could expand to $55.39 billion by 2034, up from $18.82 billion a decade ago. Amid the rising foreign exchange outflow, industry bodies have reportedly called on the government to promote inbound tourism as a balancing measure.