Tourists riding an elephant / Representational Image
Tourists riding an elephant / Representational Image
Photo by Parv Choudhary from Pexels

The impact of lockdown on the tourism industry and its allied industries cannot be neither denied nor can the velocity be anticipated. To keep a float, every firm in the industry is looking for incentives from the central and state government. In a letter written by Goa-based Casino Pride director Shrinivas Naik, he suggested the government should pay the entire EPF and ESIC contribution of all employees from the Labour welfare fund and give three years income tax holidays including Minimum Alternative Tax (MAT) with effect from FY 20-21.

Naik explained that due to global pandemic, the tourism industry worldwide is suffering. Moreover, the fear factor among the travelers would deter the travelers from travelling. “Many of the countries would keep their borders closed for a longer period of time. This would result in 60 per cent to 80 per cent reduction in travelers especially the leisure tourism sector.” He added in order to get maximum share out of remaining tourists who would include business travelers, the industry should take aggressive steps in marketing and promotion which includes reduction of room rates, additional freebees and facilities, advertisement and sales promotion etc. “Hence in order to reduce overall cost of operation and increase funds for disposal in the hands of the industry, the government should provide tax holidays including MAT, for at least three years beginning from FY 2020-21.”

He urged the authorities, “Allow the industry to pay minimum sustenance allowance to its employees during lockdown period and post lockdown period of six months.” This was among the ten suggestions Naik has made to the state and central government.

Naik feels the government should pay the entire EPF and ESIC contribution of all employees from the Labour welfare fund. He also requested banks to waive off interest on borrowed capital for six months and defer EMI for six months. Yet another request towards financial service providers is that banks should give working capital loan at subsidised rate of interest.

In the case of employees, he asked the government to order employees, who avail salary during the lockdown, to stay with an institution for at least six months till April 2021.

Other demands placed by Naik are state governments should not charge MD charges on electricity for six months, and should order Internet Service Providers not to charge monthly lease line charges for the lockdown period. “Both state and central governments should not charge any license fees for six months,” Naik writes.

Commenting on taxes, he asked the GST council to allow input credit of all fixed expenses incurred during the lockdown period from the GST payable post lockdown.

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