MoT seeks Five-year tax holiday extension for development of CWG hotels in NCR till July 31, 2010

In order to increase the development pace of hotel rooms before the Commonwealth Games (CWG) to be held in October this year, Ministry of Tourism (MoT) has urged the Ministry of Finance to extend the benefits of the Five-year tax holiday for budget hotels under construction in the National Capital Region (NCR) up to July 31, 2010, instead of the earlier deadline of March 31, 2010.  According to a report in Financial Express, an official from MoT said that looking at the macro-economic situation over the past year, most of the hotels will take a longer time to complete. Extending the Five-year tax holiday will be an incentive for hotels to speed up the process of development and start operations soon, adding to the country’s preparedness for the Games.

The Five-year tax holiday for budget hotels was introduced to attract hospitality chains to build more hotels in the NCR region. However, the economic downturn put a spanner in the development of a majority of properties raising concerns of a shortage of rooms during the Games, which are expected to attract around one lakh tourists from across the world. According to estimates,