Tourism granted industry status, amidst confusion

| 03 March 2000 22:54 IST

The unilateral decision of the state government to grant industry status to tourism may result in ultimately the tourist state losing on revenue count rather than earning anything, though the hotel lobby here has welcomed the decision.

It was passed by the cabinet recently, perhaps without giving deep thought to the whole issue of tourism, which has emerged as a backbone of Goan economy in the last two decades. The original decision, which was changed later, was to bring it into force from April.

"May be we have done a mistake by not applying our mind. We would now implement it only after studying the issue threadbare", admitted chief minister Francisco Sardinha as he could not provide satisfactory replies to a single query raised by journalists.

He has received objections not only from other corners but his own tourism minister Victoria Fernandes, who claims the cabinet note was put up by her cabinet colleague Alexio Sequeira, the industries minister, without even consulting the tourism department.

"No final decision would be taken in this regard without considering all pros and cons of it", states Fernandes, who is enraged over sidelining her while even moving a cabinet note. "It was put before us directly at the meeting", she states.

Sardinha did not even know who would get what benefits with the decision, except that the big hotels would be getting water and electricity at a much cheaper rate than the high commercial rates presently charged by the concerned departments to big star hotels.

Surprisingly, though the cabinet has decided not to scrap the luxuries tax imposed on hotels, the industry strongly feels that it needs to be rationalised immediately. "If you are not scrapping it, at least rationalise it", says Dattaraj Salgaoncar, president of Goa Chamber of Commerce and Industry.

"I am strongly opposed to it since such a status means nothing but sops. Rather than benefiting, the state would lose due to this decision", observes Dr Wilfred de Souza, former chief minister, who has been the tourism minister for the longest term in the past.

While Goa would lose on revenue generation from water and electricity after granting industry status for tourism, the state may lose annual revenue of around Rs 16 crore on luxury tax since such taxation has no place in industry. The industry, obviously, is in no mood to pay such a tax.

The industries minister however strongly proposed it while pointing out that the neighbouring Maharashtra state has already granted such a status while the central government has also been pressurising Goa in this regard.

It also appears that the government has not given any thought to which other sectors the status would apply except the hotel industry while hospitality sector includes private transport like taxis, travel and tourism agencies and even the electronic amusement provided here in the name of casinos.

"Right now it would apply to only the hotel industry. We cannot think of other sectors at this stage", quips chief secretary Ashok Nath. He has proposed that the implementation be done in stages, after examining each aspect, including the imposition of luxury tax.

"It should apply to all the tourism-related activity", feels Salgaoncar, who is however unable to tell how Goa could accommodate more hotels when beach tourism has reached a saturation point here while the policy on developing hinterland tourism has merely remained a paper policy.

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