OTAs seek change in GST rule, eye higher growth in bus ticketing segment
Online travel agencies feel that their growth is being curbed due to a 2021 policy of levying 5% GST on the sale of non-AC bus tickets on e-commerce portals
Bus ticketing is the fastest growing segment for OTAs with a daily seat inventory of around two million seats. The bus transport industry has also seen a rebound post Covid-19 pandemic and is slated to reach a valuation of around Rs.1.04 trillion by 2026. However the OTAs feel that their growth is being curbed due to a 2021 policy of levying 5 per cent Goods and Services Tax (GST) on the sale of non-AC bus tickets on e-commerce portals. Tax is not leviable if a non-AC bus ticket is purchased offline or a website of state transport corporation
“Essentially consumers are being penalised for convenience. When the rule was introduced, we used to get around 46 per cent of our bookings from non-AC segment. In the latest quarter, booking from non-AC segment has reduced to 34 per cent,” said Prakash Sangam, CEO, redBUS. “The only ones who are bearing the brunt are the OTAs. In a way it is against spirit of Digital India,” complained Aloke Bajpai, chairman and managing director of ixigo.
