5-year tax break for new hotels in districts with Buddhist history

by Amitabh Sinha, Indian Express, June 23, 2007

New Delhi, India -- Following sustained pressure from the Tourism Ministry, the Finance Ministry has agreed to give five-year tax break to new hotels coming up in districts that have places of Buddhist importance.

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This is in line with similar tax-breaks announced by Finance Minister P Chidambaram in this year’s budget to hotels and convention centres coming up in New Delhi and the National Capital Region in the next three years. This was done to provide an incentive to the hotel industry to meet the severe shortfall in rooms in view of the Commonwealth Games in 2010 and was applicable to two, three, four star hotels and convention centres with a seating capacity of 3,000 or more.

The Tourism Ministry has been pressing the Finance Ministry to extend this provision to hotels across the country. The Tourism Ministry is of the view that lack of decent hotels is one of the biggest hurdles in the growth of tourism.

Though the Finance Ministry remains unconvinced, it has agreed to extend this provision to 19 districts in six states that have places of Buddhist interest, Tourism Ministry sources said. The Finance Ministry was expected to make a formal announcement in this regard during the next session of Parliament.

“It is a very significant decision. Pilgrimage is one of the main drivers of domestic tourism. If this goes off well, we will be able to convince the Finance Ministry about the need to extend the provision to other areas as well,” sources said. The Buddhist circuit was chosen in view of the 2,550 years of the Mahaparinirvana of Lord Buddha that is being observed since last year.

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5-year tax break for new hotels in districts with Buddhist history

by Amitabh Sinha, Indian Express, June 23, 2007