Tourism Promotion Award in Limbo

The sum of money earmarked to be given to private companies for bringing foreign tourists to the country, known as tourism exports award, which has not been paid for seven years, is still contingent on the allocation of funds by the government, a senior government official said.  

Mojtaba Khosrotaj, the head of Trade Promotion Organization of Iran, said he cannot make a pledge to pay the delayed money unless finances are provided.

"I can only assure companies of the payment when the amount is allotted in the budget bill," he told ISNA .

The former head of the organization, Valiollah Afkhami, had said in 2016 that the government had not been able to pay "a penny" to the TPO in the form of export incentives due to certain constraints.

He had pledged that if the money came, the award for the year 2015 would be paid but made clear that the previous years' debts would not be settled.  

According to Ebrahim Pourfaraj, head of the Iranian Tour Operators Association, the last time tourism companies received the sum was in 2009.

"The award has not been given for nearly seven years and is now among the government's debts to the private sector," he said.

In 2010, although the amount to be paid as an award for tourism exports was earmarked with an increase, it never materialized, said Hadi Shirazi, secretary of the association.

For each tourist from Europe, America, Africa and Oceania and East Asian and Southeast Asian countries (China, Korea, Japan, Thailand, Hong Kong, the Philippines, Malaysia and Singapore) $120 and for each one from other countries $60 were to be paid to tour companies as an award.

The amount for each health tourist from the first group of states was set at $140 and for one from other countries at $70.  In addition, $30 was to be awarded for each religious tourist.

"In 2011, the award was renamed as incentive but neither the awards of 2010 nor the incentives of 2011 were ever given to companies," he regretted.

  Alternative Preference

Although the payment is a legitimate demand of tour companies, several of them prefer that the money be spent to address infrastructural issues in tourism.

Mahmoud Bonakdar, a member of the organization, said that given the sector's dire need of road transport facilities, it might be better to import a number of tourist buses with the money instead.

"Such supportive measures would better serve the tourism industry," he said.

The industry has been deprived of any export incentive since 2009. Requests for loans to import tourist vehicles have also been ignored by the Ministry of Industries.

Iran's Cultural Heritage, Handicrafts and Tourism Organization has claimed several times that it is pursuing the matter.

So far, Iran's National Tax Administration has been the only institute to take a step toward supporting tourism by agreeing to review the law on value added tax for inbound tours.

The revision is aimed at eliminating the tax on inbound package tours.