Prime Minister Narendra Modi made an unusual direct intervention on Friday (May 15) to categorically deny reports of the government considering a foreign travel tax. Responding to a CNBC TV-18 report on X, Modi stated 'This is totally false. Not an iota of truth in this. There is no question of putting such restrictions on foreign travel' in a post on X. The prime minister emphasized the government's commitment to improving 'Ease of Doing Business' and 'Ease of Living' for citizens, reiterating his stance on Friday, May 15. This rare direct intervention by a Prime Minister to address individual media reports is significant as such responses are typically reserved for matters that could trigger wider public concern.
The clarification came after CNBC TV-18 reported on Friday that the Centre was mulling over a proposal to levy cess, tax or surcharge on foreign travel. As reported by the news channel, the proposal was being discussed at the 'highest level', citing sources. The report claimed that the levy would be collected by the Centre and would not be part of the divisible pool with the states. The proposed tax was aimed at cushioning the war-related fiscal impact and was expected to be applicable for a one-year period. The report had claimed that a temporary cess or surcharge on foreign travel, likely lasting a year, was being contemplated to cushion the fiscal impacts of the West Asia crisis, which has pushed crude oil and import prices higher. According to CNBC TV-18, the proposal was being discussed in the highest echelons of the government and was aimed at cushioning the fiscal impact from the US and Israel's war against Iran, while also mitigating higher crude and import costs.
The news report had raised concerns among scores of Indians who embark on international trips for business, education and leisure purposes. However, following Modi's statement, CNBC TV-18 issued a correction and withdrew the original report. According to the news channel's statement on X, 'Our story on government considering tax/cess on foreign travel is not accurate. We withdraw the story and regret the error'. The correction came within hours of the prime minister's clarification, with the news outlet posting the apology on the same platform where the original report was published. The swift denial from the Prime Minister, followed by the broadcaster's retraction, ended speculation around a possible additional levy on outbound international travel.
Following Modi's denial, the Prime Minister called for enhanced austerity measures to withstand economic headwinds created by the West Asia conflict. On Sunday, Modi urged citizens to revive some work-from-home practices adopted during the Covid-19 pandemic and use public transport to reduce fuel consumption. These were among the measures he proposed to conserve India's foreign exchange reserves. Modi also urged the public to avoid non-essential foreign travel for a year and appealed to citizens to avoid destination weddings abroad during the period, saying that conserving foreign exchange reserves was 'an act of patriotism'. He also advised the public to avoid non-essential gold purchases to reduce pressure on foreign exchange outflows, as reported by multiple sources.
