Question

Purchase of goods by foreign tourists will be included or excluded from domestic income ?

Answer 1

Purchase of goods by foreign tourists will be included in national income.  

Explanation:

• It is the part of capital formation in the country and contribution to the growth domestic product.

• It will generate the income and it will provide employment to seller.

• When per capital income is calculated it would be included it.  

Reasons of inclusion of this income are as follow.

• It is spend in India.
• Seller is the Indian citizen.
• Seller pays tax in India.
• Amount is paid in India.