Tourism sector wants equal treatment as infrastructure

Mahua Venkatesh

The tourism industry, one of the sectors worst affected due to the economic downturn, is hoping that the coming Budget would give it the much-required boost.

In a pre-budget memorandum, the tourism industry has suggested it should be treated on a par with industries such as infrastructure, software and export, which means the tax concessions given to these industries should also be given to the tourism industry.

Besides, the industry has demanded at least 5 per cent of the total foreign exchange earnings from tourism be allocated for the development of the sector.

"Today there is no fixed amount allocated for developing tourism," says Subhash Goyal, chairman, Expert Committee on Tourism & Aviation. Also it has urged that 50 per cent of the revenue collected from taxes levied on tourism should be allocated for the development of tourism infrastructure.

According to Goyal, the industry is one of the largest generators of jobs and a valuable foreign exchange earner for the country. "Therefore we are hoping the government would give us the required sops to promote the industry," says Goyal.

In fact, one of the main demands of the industry is the benefits available under 80HHD should be made on par with 80HHC and 80HHE.

At the same time, Goyal said the time period for the utilisation of the tourism development reserve should be extended from five years to eight years and "all assets should be considered for utilisation."

Apart from this, the industry has called for uniformity and rationalisation of taxes. "Today there are different taxes being charged at different levels, this must change," says Goyal.

The industry has urged that different taxes like service, luxury and state taxes should not be charged at different levels as it is happening today. Taxes should be taken at one point and the total should not exceed 10 per cent. Interestingly, today it varies from 15 per cent to a whopping 30 per cent.

The industry has also asked the government to lower the domestic air fares to promote tourism, while reducing duties on alcohol and liquor.

In addition, the industry has also asked for a tax holiday of five to 10 years along with the hotels to promote tourism.

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