OREANDA-NEWS  The exemption of domestic tour operators from VAT on tours in Russia will allow companies to actively develop domestic tourism and reduce the cost of organized holidays in the regions. Ilya Umansky, President of the Russian Union of Travel Industry, predicted a reduction in prices for travel around the country for Russians, Interfax reports.

"Any excess loads inevitably fall on the shoulders of the consumer, so tour operators had to put it into the cost of the package: to compensate something from their own income, to compensate something by increasing the price," he explained. In addition, the announced VAT reset will allow tour operators to spend the saved funds on the development and expansion of business in Russia. Thus, it is expected not only to increase the range of offers from representatives of the tourism industry, but also to increase the number of new tourist products.

"Tour operators do not have such marginality in order to cover the fiscal burden of 20 percent with their income. They were not able to develop in such conditions and would have been forced to optimize their business," Umansky added.

Earlier, the Russian authorities proposed to exempt domestic and inbound tourist trips in Russia from VAT. Minister of Economic Development Maxim Reshetnikov noted that proposals are being worked out to exempt tourist products from VAT, but only if they are used for domestic trips or inbound tourism.