What are the problems facing the tourism industry?
Tourism is an important driver of the economy. One of the major problems facing the industry is the plethora of taxes. Though the Central Government has recognised this, in four States, the tax is on the published tariff and not on the rate paid by the customer. This is contrary to any consumer product where you are levied tax on what you pay for. Ideally, the tax should be 10 to 15 per cent on the room component of the bill. Rationalisation of taxes at the State-level is an imperative. Besides the tax on room tariff, there is tax on food. This drives the cost up. All these issues have to be addressed Not everyone who stays in the hotel is rich. With the increase in domestic travel, there is a need to put up quality hotel in a large number of places like pilgrim towns. It is very difficult to put up a hotel or even a restaurant in a pilgrim town as there are so many licences to get. This is a huge issue. Despite this, a number of hotels, especially smaller ones, are coming up in unusua
