Govt Mulls Taxing Foreign Travel For A Year: Report
The government is considering imposing a tax, cess, or surcharge on foreign travel, but no final decision has been taken yet. According to the report, the proposed levy on foreign travel is being discussed at the highest levels of the government
The government is considering imposing a tax, cess, or surcharge on foreign travel, but no final decision has been taken yet, CNBC-TV18 reported, citing sources.
According to the report, the proposed levy on foreign travel is being discussed at the highest levels of the government.
The amount collected through the tax, cess, or surcharge would go directly to the Centre and would not be part of the divisible pool shared with states.
The report said the proposed measure could be temporary and may remain in place for one year.
The government is considering the move to offset rising crude oil and import costs linked to the ongoing US-Iran conflict.
The discussions come days after Prime Minister Narendra Modi urged citizens to avoid unnecessary foreign travel, reduce fuel consumption, and avoid buying gold jewellery for one year in an effort to lower India’s import bill during the Gulf crisis.
The global energy situation has worsened after Iran closed the Strait of Hormuz, disrupting a major share of global oil and liquefied natural gas supplies.
Crude oil prices have risen above $100 per barrel, increasing inflationary pressure across countries.
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Airfares have already increased as airlines raised fuel surcharges. Foreign travel has become more expensive due to higher transportation and hotel costs.
India’s tourism sector is currently valued at about $231.6 billion and supports nearly one-tenth of the country’s jobs.
Industry estimates suggest that India’s outbound travel market could grow to $55.39 billion by 2034 from $18.82 billion a decade earlier.
Industry groups have reportedly urged the government to encourage inbound tourism to reduce foreign exchange outflows.
The report also noted that outbound travel from India rose nearly 6 percent to 32.7 million departures in 2025, driven by rising incomes, easier visa access, and social media influence.
India is expected to become the world’s fifth-largest outbound travel market by 2027, compared to tenth place in 2019.
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