Home stay scheme eats into hoteliers’ business

SHIMLA: The tourism industry has sought a ban on home stay units within 15 kms of the Shimla Municipal Corporation and other tourist towns as it is affecting the business of hotels.

Owners of small hotels rue that they are being affected by the home stay scheme as in many cases the number of rooms is far more than the limit of three and the Incredible Bed and Breakfast scheme of the Government of India (up to six rooms), reports The Tribune.

“The survival of small hotels, with less than 10 rooms in the urban tourist destinations, all over the state has become difficult as we have to pay heavy taxes as compared to no taxes on home stay units,” said MK Seth, President of the Tourism Industry Stakeholders Association, affiliated with the Confederation of Indian Industry (CII).

He said the home stay scheme was affecting 45 per cent of the 268 registered hotels within the Shimla MC and a similar situation existed even in other popular tourist destinations such as Manali, Dharamsala, Kasauli and Dalhousie.

He added that the water rates in Shimla were the highest ranging from Rs 60 to Rs 110 per kilo litre and to make matter worst, they had to meet their requirement by engaging water tankers as there was always water shortage.

He elaborated that the hotels had to pay 19 per cent tax on rooms, 10 per cent hike in water tariff every year, 30 per cent sewerage cess on water bills, 20 per cent commission to travel agents along with increase in wages every year.

“In some parts of Shimla, where the land falling on the hill side is in urban areas and the valley side is in rural areas, several home stay schemes have been launched,” explained Divij Sood, general secretary of the Tourism Industry Stakeholders Association.

Sood said the government must check the violations by home stay and the Incredible Bed and Breakfast schemes as these affected hoteliers in small towns.


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