New Delhi: As Budget 2025 is all set to be presented in the Parliament on February 1, 2025, the hospitality sector appealed to the government for infrastructure status and rationalisation of tax rates among other demands. Finance Minister Nirmala Sitharaman will be presenting the Union Budget 2025-25 this Saturday.
Hotel Association of India President K B Kachru asked the government to address the infrastructure status, rationalisation of tax rates, easier visa processes and more incentives by state governments to promote investments in the hospitality sector,
In an interview to PTI, Kachru, gave the examples of South Korea, Japan and Thailand’s emphasis in growing their tourism sector while putting forward the industry’s demand.
“We need investment. Investment can’t be done by the government alone. Private sector has to come in and invest. What would motivate them to invest in the country is they must have a respectable (return on investment) ROI then only they will invest,” Kachru said.
Tax Rationalisation and Investment Incentives
The Hotel Association of India President highlighted that “taxation is a big issue” in India and urged the government to rationalise the tax rates. He said the government can implement practices of Singapore, Sri Lanka and Thailand.
“… There was a time when we used to have close to 100 licenses to start a hotel. It has been substantially reduced. But still, I think we need to, we need to make it easier for people to operate hotels… Principally, everybody accepts that there should be a single window, but till that stage comes, I feel we should reduce approval processes to the minimum,” he said.
Kachru also advocated for an easier visa process to boost the tourism sector. He said Thailand, Japan, and South Korea were able to increase their GDP by focusing on their tourism sector.
Streamlining Regulations and Visa Processes
Thailand’s tourism sector’s contribution to GDP is around 25 per cent, he said. “We (India) are still struggling around 6 per cent or so… If we give it infrastructure status, the loans will be at a decent rate, as given to all other industries. we’re not asking for more.”
While recalling the Finance Minister’s announcement during the Union budget 2023-2024, when she said at least 50 destinations will be selected and developed as a complete package of tourism, Kachru said the government should give incentives to develop infrastructure in terms of hotels, entertainment centers and convention halls.
“So I’m saying, if you are doing those 50 destinations, if there’s a project worth Rs 10 crore that should also be part of the industry. We cannot say it can’t be done,” Kachru noted.
The state governments should give concession on electricity tariffs to the players in this sector, he said.
Ahead of Budget 2025, the Hotel Association of India (HAI) urged the government to grant infrastructure status to the hospitality sector, rationalise tax rates, and simplify visa processes. HAI president K B Kachru highlighted the need for increased investment and cited examples of successful tourism-focused economies like Thailand and South Korea. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today