Hospitality Centers Are Looking For Additional Logistics To Turn Around

The entire hospitality business, including tourism, has practically collapsed due to the spread of the corona virus, the lockdown to combat it and the restrictions on the movement of common people. Many hotel restaurants are closed permanently. A lot of problems fell on employment. After the wave of epidemic, business activities resumed in this area, but many of the old workers did not return to work. The hospitality sector is seeking some logistics from the Center in the upcoming budget to tackle all these issues. For example, recognition of infrastructure and industry for sanctioning long-term loans on easy terms and low interest, introduction of uniform GST rate for all types of hotels, bringing hotel expenses under tourism allowance (LTA), minimum alternative tax waiver for at least two years, etc.

Even though it is called an industry, the hospitality sector has not yet received the full recognition. As a result, multiple benefits do not match. Federation of Hotel and Restaurant Associations of India Secretary General Jason Chacko and Hotel and Restaurant Association of Western India President Pradeep Shetty called for infrastructure and industry recognition in the hospitality sector. According to Jason, typically the hotel restaurant business gets loans for seven to nine years. 

Hospitality Centers
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But in many cases it takes them longer to reach no-profit-no-loss. So long term (15-20 years) loan is essential. Acknowledgment of infrastructure sector will make it easier. Organizations can raise the necessary funds. As a result, if the quality of accommodation is improved, the number of tourists from home and abroad will also increase.

Low rate of interest 

If the industry is recognized, the loan will be given at low interest, and the electricity bill will be reduced. Jason said, for example, hotels now charge commercial rates (which are the highest) for electricity. They will have to pay a lower rate (industrial rate) if they get the status of industry. He claims that hospitality industry does not get its benefits despite how many states call it an industry. That is why the center should allocate funds to the states by bringing the sector in the joint list. This business will benefit if the coordination between the Center and the State is better.

Government and private organizations provide employees with a portion of the travel expenses for travel. According to Pradeep, the cost of the hotel should also be added to that benefit. The money paid by foreign tourists in the hotel should be seen as foreign currency. Which is essential for the benefit of the EPCG project in the export sector.

The hospitality sector also seeks temporary relief from minimum alternative tax. According to Pradeep, the exemption should be given from next April to March 2025. 


• The hospitality industry should be recognized as an infrastructure sector. In that case they will get long term and easy interest loan.

• Center directs financial assistance to states by bringing them into the joint list. It will make it easier to properly implement the industrial designation given by the state.