Effective January 22, 2017, service taxes on all tourism products have been increased form the 4.5% rate to 9%. This was a move announced with just 5 days notice and was done that has sent shock waves through the entire Indian tourism industry. The Indian travel industry is already the most heavily taxed in the region and that has a serious impact on our competitiveness as a destination.

We do see this tax change as a set inline with the new rules for the GST system that will roll out by the mid of the year. The GST system will bring a complete change to the Indian indirect tax system and in many way sis a welcome move. However as there are many uncertainties on its application, rules and procedures, it is making people nervous. You can read an article on the GST system here https://www.bloomberg.com/news/articles/2016-08-02/what-s-the-big-deal-about-india-s-goods-and-services-tax-q-a 
 

The Indian tourism industry is of course working collectively to see how we can roll back this sudden tax hike as it is mid-season and the impact will either have to be passed on to the traveller or be absorbed by the Indian operators who already are working on thin margins. Intense lobby is going on with policy makers and do expect to be updated by us or your partners in India.
 

Some press coverage can be seen at the following -
 

http://economictimes.indiatimes.com/news/economy/policy/faith-approaches-finance-ministry-on-service-tax-issue/articleshow/56719607.cms

http://www.business-standard.com/article/pf/get-ready-to-pay-more-service-tax-for-your-summer-vacation-117011800356_1.html

http://economictimes.indiatimes.com/industry/services/travel/service-tax-on-tour-operators-indian-chamber-of-commerce-and-industry-approaches-government/articleshow/56681990.cms

Seeking to promote medical tourism and attract more business visitors, the Union cabinet on Wednesday expanded the scope of e-tourist visa to include purposes such as short-term medical treatment, business trips and conferences. With the enlarged scope, the e-tourist visa will be rechristened the e-visa and shall allow the holder dual entries for tourism and business purposes and three for medical treatment.

As per the Cabinet decision cleared by the Modi government, the e-visa scheme will be extended to 8 more countries, taking the total number of nations that enjoy the facility to 158.

E-visa will now have a validity of 60 days and can be applied for by foreign nationals up to four months ahead of the visit.
"The Union Cabinet has given its approval for liberalisation, simplification and rationalisation of the existing visa regime in India and incremental changes in the visa policy decided by the ministry of home affairs in consultation with various stakeholders," said a government release issued after the Cabinet meeting.

"The approval will facilitate entry of foreigners for tourism, business and medical purposes. This is expected to stimulate economic growth, increase earnings from export of services like tourism, medical value travel and travel on account of business and to make 'Skill India', 'Digital India', 'Make in India' and other such flagship initiatives of the government successful," it added.
Tourists, businessmen or people coming for treatment or to attend conferences will be covered under the new category of visa, which was first mooted by the Commerce Ministry following a suggestion by the Prime Minister's Office (PMO) to boost services trade.

Medical tourism in India alone is estimated at USD 3 billion and projected to grow to $7-8 billion by 2020, according to a PTI report.
Foreign patients travelling to India for medical treatment in 2012, 2013 and 2014 stood at 1,71,021, 2,36,898, and 1,84,298 respectively.

Small countries like Thailand attract millions of people whereas tourists flow in India is far less.
Business and health visa to be granted within 48 hours after submitting the application in case of emergency.
Citizens from Pakistan will not be covered under the new liberalised visa policy.