Question

discuss the major difference between the formal and informal sector in tourism.(600 words)

Answer 1

The major difference between formal and informal sector in tourism or as in any other industry is that the formal sector pays tax while an informal sector does not pay tax.

Tourism is a vast industry and it comprises of many formal and informal industries and individuals.

Example, a licensed guide is part of the formal sector while an unlicensed guide is a part of the informal sector.
A registered restaurant that encompasses all jobs with normal hours, pays regular wages and pays tax properly is part of a formal sector. While an unregistered restaurant or a roadside vendor who does not pay tax is part of the informal sector.
Similarly, street sellers, craft markets, taxi drivers, tour operators, lodging service providers who have not registered legally to offer the services are part of the informal sector.
The formal sector comprises of registered Food and Beverages (F&B), lodging, transportation, travel technology companies and such likes which pays taxes regularly for the services offered.
I hope this helps.

Thanks

Answer 2

The difference between the informal and formal sector tourism is that the informal sector does not pay the tax while the formal sector does. In the informal sector unlicensed guide is the part and in the formal sector, it is a licensed guide. Also, the roadside vendors and unregistered restaurants and encompassed under the informal sector whereas, the restaurants which pay its labor wages and have normal working hours is categorized under formal sector. Therefore, the craft makers, street sellers, tour operators and lodging services which are registered legally re under formal sector and while unregistered ones are under informal.