The Tourism Minister Mr. Sahai has written to Finance Minister Pranab Mukherjee seeking roll back of the proposed service tax on hotels and restaurants as it feels that the measure may have an adverse impact on the sector.

The Government had in the 2011-12 Budget proposed to levy service tax on hotel rooms and AC restaurants which have licence to serve liquor. The proposal is strongly opposed by the tourism industry which fears that this will affect the flow of tourists adversely."It (service tax proposal) is a matter of concern for us. I have already written to the Finance Minister to reconsider it," Tourism Minister Subodh Kant Sahai said after a meeting of the National Tourism Advisory Committee here.

Pressing for the rollback of the service tax proposal, Sahai said: "The government and policy makers should realise the fact that tourism sector is a forex and employment generating sector.

Chairing the first meeting of the reconstituted National Tourism Advisory Council (NTAC) in New Delhi today, Union Tourism Minister Shri Subodh Kant Sahai also called for more stress on domestic tourism. He said the huge size of domestic tourism helps to sustain the industry irrespective of the variations in international travel. The majority of the domestic travel is for pilgrimages. He was of the opinion that there is a need to enhance facilities at our major pilgrimage centres which receive a large number of visitors. 

Shri Sahai said the lesser known destinations in the country need to be developed so that the benefits of tourism activities reach far and wide, and contribute in balanced regional growth of the country. He said, States need to be pro-actively engaged in sensitizing them to the huge untapped potential which tourism holds for employment generation and economic development. 

Underlining the need to maintain quality of tourism facilities and services offered so that they are at par with the best in the World, Shri Sahai said “We must keep pace with changing trends and requirements of the overseas and domestic travellers, who are increasingly becoming more demanding. We can ill-afford to be satisfied with the growth of the tourism sector seen in the last decade. We have to improve our products, plan carefully, refine our marketing strategies and bolster our efforts for sustainable growth of this vital industry.” 

Talking about Infrastructure development , Shri Sahai said it holds the key to India’s sustained growth in the tourism sector. Therefore, the Ministry of Tourism has been making efforts to develop quality tourism infrastructure at tourist destinations and circuits. The Ministry has launched a scheme for development of nationally and internationally important destinations and circuits through Mega Projects. So far, 38 mega projects have been identified out of which 26 projects have been sanctioned. The mega projects are a judicious mix of culture, heritage, spiritual and ecotourism in order to give the tourists a holistic perspective. 

Summing up the discussions Shri RH Khwaja, Secretary (Tourism) said that his Ministry has been working in close cooperation with the private sector for development of tourism in India. He expressed the hope that views emerging out of the discussions held would help the Ministry as well as the hospitality and travel industry to take longer strides in achieving our common goal of positioning tourism as an engine of economic growth. 

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