On Thursday, March 31, an open meeting of the Government with the tourism industry was held “On measures to support the tourism industry in the face of external sanctions pressure, the development of domestic tourism and preparations for the summer tourist season 2022.
A live broadcast of the meeting of Deputy Prime Minister Dmitry Chernyshenko with representatives of authorities, tourism industry, investors on issues of supporting the tourism industry in the face of external sanctions pressure was conducted on the channels of the Russian Government.
Watch the recording on the page “Government of Russia” on YouTube
Watch the entry on the “Government of Russia” page on VK
Among the speakers, along with Zarina Doguzova, head of Rostourism, heads of regions, business representatives, the General Director of the tour operator FUN&SUN (ex. TUI Russia ) Taras Demura.
During his speech, Taras Demura noted that thanks to state support measures, the tourism business adequately withstood the difficulties of the pandemic period: “The industry not only survived, but also actively developed, and this is especially true for domestic tourism. Thanks to the synergy of federal, regional authorities and the tourism market, together we implemented unprecedented support measures, there were no such measures in the world as those taken by our government.” Among the most effective measures, he called the Tourist Cashback program, subsidizing charters in Russia, compensation for outward flights, reduction, and then complete exemption, from paying contributions to the Tour Operators' Personal Responsibility Fund.
The speaker noted that now the situation in the industry is complicated by the imposed sanctions and anti-Russian sentiments abroad. In some countries, domestic tour operators have lost prepayments and advances that were made by them to foreign service providers. The key to the stability of the industry, according to Taras Demura, is the active development of domestic tourism, in particular on the basis of charter programs. “Thanks to the subsidy program, with the support of the Federal Tourism Agency and the personal participation of Zarina Valerievna, we have greatly expanded the geography of our charters. These are Baikal, Sakhalin, Sheregesh, Karelia, Tyumen, Kazan, Murmansk. This year we are adding new charters to Kamchatka, Altai, the North Caucasus and others, and not only from Moscow, but also from St. Petersburg.”
The FUN&SUN General Director emphasized that the cost of charter tours is 2 times cheaper than self-organized trips. At the same time, tourists arriving by charter leave much more money in the region than independent travelers and business tourists. Since a tourist who has already purchased a tour takes additional excursions, visits restaurants, purchases various souvenirs, etc.
Speaking about support measures that can help companies continue to work and fulfill their obligations to customers, Taras Demura supported the previously made proposal to postpone until December 31, 2023 the fulfillment of obligations of tour operators for failed tours booked before March 1, 2022. “We, as a company, see that a year and a half is enough to fully pay off,” he said, “we paid off our customers by the end of 2021, as planned”
As an additional support measure, Taras Demura suggested considering the possibility of subsidizing the rebooking of canceled foreign trips by tour operators for domestic ones: “Tourists are often ready to change destinations, but as a result of the depreciation of the ruble, tour operators cannot provide a product of equal quality. Therefore, if possible, we could, with the support of the state, unconditionally rebook all booked foreign tours for Russian tourism.
Taras Demura also supported the initiative of the tourism industry to zero the VAT rate for tour operators working in domestic and inbound tourism. The essence of the problem is as follows – when bundling flight and accommodation services, which are separately not subject to VAT, tour operators must add an additional 20% tax to the cost of these services. “This leads to an increase in the cost of the domestic tourism product and makes its cost uncompetitive compared to outbound destinations. Therefore, zeroing VAT for tour operators is a very important measure, it is actually overdue,” explained Taras Demura.
Deputy Prime Minister Dmitry Chernyshenko, after the speech of the head of FUN & SUN, asked for more statistics on the practice of levying VAT on tourism products . Regarding the transfer of canceled foreign trips and subsidizing their rebooking to Russian destinations, the Deputy Prime Minister replied, “We will ask Rostourism to work this out, because we have a positive experience when canceled tours were converted into Russian ones during covid. We need to see what financial model will be obtained. In any case, we will work on it.”