India on tourism boom but high service tax acts as a dampner

Jaipur, Aug 17 (UNI) The World Travel and Tourism Council (WTTC) rates India as one of the foremost tourist growth centres in the coming decade, which is likely to generate 121.4 billion dollars by 2015 and generate employment over 100 million.

But the tourism industry complain that the government policy has not changed in tune with the times and is inconsistent.

Addressing a press meet here today, president of the Indian Association of Tour Operators (IATO) Subhash Goyal said, ''On one hand, the government had opened up the sky but on the flip side, it is charging 40 per cent service charge from the hoteliers, which is exorbitant.'' He said the service tax charged in India is 40 per cent of the package cost which is the highest in the world. However, the Indian companies receive only 10 per cent as commission/service charges.

He pointed out that in countries like China, Singapore, Sri Lanka, tourism has flourished because of low taxes.

He said the inbound tourism sector has shown a growth rate of about 30 per cent but the industry has not been able to cope with the inflow due to infrastrutuial bottlenecks.

Mr Goyal said since the tourism infrastructure growth has not matched the tourist inflow, resulting in tariff hike by existing hotels. He feared this would led to tourist diversion to other countries.

Mr Rajesh Mudgill, a tour operaror, said there was an acute shortage of hotel rooms and other infrastructures such as guides, airports, human resources and facilities at the monuments and highways.

He said, ''The hotel rates are going sky high. There is an urgent need to maintain, upgrade, and build new infrastructure so that we meet the demand of the industry.'' He demanded that the government should make available land at subsidised rates or on long term lease for construction of new hotels apart from addressing the issues of infrastructure to cash in on the tourism boom.

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