The Ministry of Tourism has advised both state governments and Union Territories to rationalise taxes for the growth of the tourism sector in the country. The government has asked the states to follow tourism-friendly policies like allotting land sites on revenue sharing basis, granting extra floor space index and floor area ratio (FAR) for hotels, creation of land banks, single window system for promoting hotel projects, according to a report by PTI.
An investment-linked deduction under Section 35 AD of the Income Tax Act has been extended for new hotels under the two-star category and above, anywhere in India, to facilitate the growth of tourist accommodation in the country, he said. The Reserve Bank of India has de-linked credit for hotel projects from commercial real estate, thereby enabling hotel projects to avail credit at relaxed norms and reduced interest rates. External Commercial Borrowing (ECB) norms have also been relaxed by the Finance Ministry to solve the liquidity crunch being faced by the hotel industry for setting up new hotel projects. In order to encourage the growth of hotels, the government has announced a few incentives like five-year tax holidays for two, three and four-star category new hotels located in UNESCO-declared World Heritage Sites (except Mumbai and Delhi) which start operating between April 2008 and March 2013, said Sultan Ahmed, Minister of State for Tourism, Government of India, in the Lok Sabha yesterday.
Click here to see the original article>An investment-linked deduction under Section 35 AD of the Income Tax Act has been extended for new hotels under the two-star category and above, anywhere in India, to facilitate the growth of tourist accommodation in the country, he said. The Reserve Bank of India has de-linked credit for hotel projects from commercial real estate, thereby enabling hotel projects to avail credit at relaxed norms and reduced interest rates. External Commercial Borrowing (ECB) norms have also been relaxed by the Finance Ministry to solve the liquidity crunch being faced by the hotel industry for setting up new hotel projects. In order to encourage the growth of hotels, the government has announced a few incentives like five-year tax holidays for two, three and four-star category new hotels located in UNESCO-declared World Heritage Sites (except Mumbai and Delhi) which start operating between April 2008 and March 2013, said Sultan Ahmed, Minister of State for Tourism, Government of India, in the Lok Sabha yesterday.