Hospitality industry expects growth based Budget

By: |
February 12, 2015 5:27 PM

While last year's annual budget gave hope to the tourism industry, this year's budget seems to have set the bar higher with the Indian hospitality industry expecting a growth based budget

While last year’s annual budget gave hope to the tourism industry, this year’s budget seems to have set the bar higher with the Indian hospitality industry expecting a growth based budget that will specifically address the present issues faced by them and will set them on an upward growth trajectory. From rationalisation of the tax structure to easening of business through single window clearance, the hospitality industry’s expectations this year is wide and varied.

Kamlesh Barot, director- Vie Hospitality and past president, Federation of Hotel & Restaurant Associations of India (FHRAI) said, “We’re expecting a lot of announcements from the new government’s budget, relying upon their promise to establish tourism as a major pillar out of the strategic four. Rationalisation of taxation, ease of doing business through single window clearance, removal of double taxation on rooms (LT & ST) and food (VAT & ST), increase in supply of rooms to rationalise the room tariffs by relaxing FSI, incentivising skill development, inclusive and sustainable tourism sops, are just some of the expectations we have.”

Dinesh Khanna, executive director, Eastern International Hotels; Novotel Mumbai Juhu Beach, Mumbai; Majorda Beach Resort, Goa; The Club & Khanna Hotels, Mumbai; and Vivanta by Taj– Bekal, Kerala said, “With the decline of tourism from the Russian and other territories and also Europe, Indian tourism efforts should be made aggressively on the market not affected by slow economic growth like China, Singapore, Australia and other regions. Uniform tax structure, should be applicable in all parts of country, such as luxury tax, etc. The e-visa introduced by the present government, should be implemented on the ports of entry all over the countries and also, include other countries which are not being included as this will generate additional inflow of foreign tourists. Connectivity within the country should be much more and fares are very high for flying between Mumbai to Delhi and South India especially during long weekends, which encourages people to fly to Thailand, Malaysia and other neighboring countries.”

Bharat Malkani, president, Hotels and Restaurant Association (Western India) said, “We expect the government to bring forth a growth related budget for this sector. Given the fact that in our region we get less tourists than Sri Lanka, Malaysia, Nepal or even Dubai its time that we rationalise the tax situation for the industry. Firstly, abolition of service tax which amounts to double taxation. Secondly, reduction of luxury tax by 50 per cent to bring us to global standards and license raj must be done away with completely with the union government doing away with all unnecessary licenses for hotels. Finally, infrastructure status should be given to the industry with the minimum ceiling limit of `25 crores to qualify. Currently, the hospitality industry is bleeding, it is one of the worst hit in India. Half the hotels are for sale. Tourists coming to India are appalled by the state of most of the hotels that are beginning to look weary and beaten. We are waiting for the benefits to accrue as of date.”

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