By OUR STAFF REPORTER
DEHRADUN, 14 Apr: Sandeep Sahni, President,
Hotels’ and Restaurants’ Association of Uttarakhand, has written a letter to Chief Minister Trivendra Singh Rawat pointing out that the ongoing lockdown has had a ‘disastrous impact’ on the hospitality sector, especially the Hotels & Tourism Industry.
He has stated that the Tourism Industry would take a much longer time to revive because people would be scared to travel for a long time even after the situation normalises. Due to poor financial health post lockdown, people will be left with very little spending capacity and be busy resurrecting their lost businesses rather than travel for leisure.
He has sought support from the Government to revive. Some of the major relief measures he has suggested are regarding salaries and wages; loan repayments and waiver of interest; GST rate and payment; water & sewerage charges; electricity bills; local taxes; promotion issues; bar licence and VAT; and minimum wages.
He has stated that the Industry is highly labour intensive, requiring unskilled, semi-skilled and skilled manpower in large numbers. With business completely shut down since the 3rd week of March, the biggest concern is payment of salaries and wages. He states it is impossible to pay the salaries with zero cash flows for such a long period. Since the staff is technically on leave due to this medical emergency, he suggests the ESIC Corporation can be directed to pay their salaries as they do when the staff is on leave due to some medical condition. For the staff that is beyond the coverage limit of the ESIC, the establishments may be allowed to pay 25% of the salary and the balance may be paid by Government or government agency like EPF. Those not covered under ESIC but which are covered in GST, he wants the Government to pay salaries to all the employees corroborated by balance sheet and certified by CA.
The capital intensive industry has a heavy burden of interest and instalments of loans borrowed from banks. He wants the instalments to be deferred for at least 6 months and the interest for the period completely waived.
In order to provide affordable travel and stay, lower taxation on the Industry has been sought. The slabs could be reduced from 12% to 5% and from 18% to 12%. The payment of the GST should be made six monthly for at least two years to enable hotels generate short term working capital.
There is an automatic increase of 15% in the water charges every year. This needs to be deferred completely for at least 5 years, he adds. As there would have been hardly any consumption during the lockdown period, the water and sewerage charges are sought to be completely waived.
The Electricity charges include a “Fixed charge” component. This needs to be exempted for the lockdown period, as has already been done by the Uttar Pradesh Government. The bills of the lockdown period may be allowed to be paid after 6 months with no penalty. He also advises reduction in Commercial Electricity Tariff by about 10% for a period of 5 years, on the lines of announcements made by Maharashtra, Punjab and other Electricity Regulatory Commissions of various states.
The Local and Municipal taxes are sought to be stayed for a period of one year.
He also wants that, post lockdown, the Government should promote and advertise the state’s destinations extensively and encourage domestic tourism. All pending proposals with regard to infrastructure should be cleared at the earliest, for this sector to pick-up.
VAT & Cess on Foreign Liquor at 22% and Cess on IMFL at 2%, presently, needs to be exempted till 31 March, 2021, on the lines of the exemption granted by the Uttarakhand Government after the Kedarnath disaster. The Bar Licence fee already paid in February 2020 for the licensing period 2020-21 needs to be continued for the period 2021-22 also.
Minimum wages in terms of VDA ought not to be increased for at least the next 2 years.