Where is the benefit – TFT preliminary analysis on MOT’s benefits to MICE Organizers under Champion Sector in Services Scheme
Ministry of Tourism, on 5th of May issued guidelines for promotion of MICE Tourism under Champion Sector in Services Scheme (CSSS)
The File No. NT-1101/1/2020-NT, dated 05.05.2020 says; MICE attracts large groups of foreign tourism, and since MICE sector benefits local entrepreneurs, creates jobs, gives boost to cultural tourism, facilitates people to people exchange and helps in image building of the destination, the Govt. of India has decided to extend the benefits to the MICE Organisers under Champion Sector in Services Scheme, administered by the Ministry of Tourism (MOT). The guidelines further say that for this purpose, a “MICE Fund” has been set up under the CSSS for three years.
TradeFairTimes did a dig into the the said benefits the Ministry has offered and found that the scheme is nothing but just a lollypop or may be a human error.
TFT also found in this analysis if this is really not a “Fund” but a mere Rs 72000 on a revenue of Rs 800,000 generated by the Conference organsier himself.
TFT contacted Madhu Dubey, the Executive Director of Indian Convention Promotion Bureau ( ICPB) to get her statement of the scheme. She informed, “ICPB is compiling comments/inputs of members on this scheme and will be proposing recommendations to Ministry of Tourism to widen the scope of the Scheme” .
What is the Incentive under this Scheme?
The aim, as per Ministry of Tourism is to promote MICE Tourism in the country. Now look at the pre-conditions– “The Conferences to have minimum of 500 participants and must comprise of at least 20% foreign participants to be eligible for the incentive. The Financial Incentive would be extended to International Conference/ Convention organizers in the form of reimbursing 50% of GST on hotel rooms for International / Foreign participants / NRIs on actual basis subject to GST being paid to be not more than 18%. The incentive of the GST incurred on hotel stay up to a maximum charge of Rs. 8,000/- per day per room would be made for 1 (one) night/ first night only”.
Sanjiv Agarwal, Founder of Fairfest Media Limited, one of the country’s largest organizer of OneWorld Travel Mart (OTM) and Travel and Tourism Fair (TTF) Shows told TFT, “What to say; the circular is issued at a time when we shall be grateful to know since when MICE can be organized – which is a bigger existential question.”
See the additional Clarification too in the same notification:
Reimbursing 50% of GST incurred on hotel rooms on actual basis with Room Tariff not to exceed Rs. 8,000/ subject to GST being paid to be not more than 18% for conferences with over 500 Pax. However, The Participants / Organisers are free to book the room within the range or higher. In the event, the GST rate is lowered by the Government on hotel rooms having room tariff within the range of Rs. 8,000/-, then 50% of the GST shall be reimbursed as per the applicable slab (The upper ceiling of extending the incentive would remain to be 50% of the GST not to exceed 18% on Rs. 8,000/- per room).
Now see as to how this is going to benefit the MICE Organizer?
You, (as an International Conference Organizer) have 500 Pax minimum with 20 % of foreign delegates i.e. 100 Foreign Delegates Rooms at a Hotel with a room tariff of Rs 8000. This is what you will get: Rs 8000 x 100 rooms x 18 % =Rs 144,000 /2 = Rs 77,000 net as GST Benefit.
A Conference organizer, not willing to be named said on the scheme “I think we will earn more negotiated commission that this meagre GST benefits from the Hotel where these foreign delegates are going to be staying, that too on all room nights. Further no five-star Hotel will charge Rs 8000/night for an International Conference, now in which conference the delegate will stay in hotel just for a night” he added.
Jut hold on. This is not all- you need to run around the authorities too.The approving authority to avail this benefit is Secretary (Tourism), Govt. of India and the beneficiaries are only the below…
(i) International Conference organisers approaching the MOT/ ICPB
(ii) International Conference Organisers approaching ICPB Members
(iii) International Conference Organisers approaching IATO / Organisations / Associations recognized by the Ministry of Tourism.
(iv) World / Regional Conferences
No, you are not yet done:You also need a prior approval of Ministry of Tourism as guidelines says “It would be mandatory for the event organisers to obtain a prior approval of the Ministry of Tourism for seeking the financial incentive under the scheme (Prescribed Format is enclosed at Annexure -I). It would be mandatory for all the applications to have a letter of No Objection Certificate (NOC) / Letter of Support of the ICPB/IATO/Organisations/Associations recognised by the Ministry of Tourism”. No this is not yet over; the guidelines further says “It is seen that the Organisers of International Conferences being held in India regularly engaged the services of their Indian counterparts or a Professional Conference Organiser (PCO)/Event Management Company for all the logistic arrangements towards the conference. Hence, the application for seeking pre approval must be jointly signed by both the International conference organiser and the Indian Associate/Event Management Company” further All pre-approvals have to be sought minimum 60 days before commencement of the event. You have more to do “The No Objection Certificate (NOC) / Letter of Support must bear the names of both the International Conference Organiser and the Indian Associate/ Event Management Company as the Financial Incentive would be released to the Indian Associate / Event Management Company only”. Further “It would be mandatory for the conference organiser to submit the details of the number of international delegates / speakers who would be utilising the hotel stay. This would include a list of the participants with copy of their Passport and Visa, along with receipt of hotel stay”.
Now finally Read this: The notification say “The conference organiser would require to submit a Certificate of the Hotel regarding number of guests with names, number of bed nights availed, rate and the amount of GST paid. GST Paid… ? So where the hell is MICE Fund”?
Let’s wait to see the response from the MOT on the fresh recommendations being prepared to be submitted by the ICPB.