Budget hopes for Indian hospitality in 2024

Wednesday, January 31, 2024

With anticipation building for the Union Budget 2024, Mr. Ramachandra Bhat, the Director of Finance at Clarks Exotica Convention Resort & Spa, outlines key expectations poised to significantly impact the Indian hospitality sector.

Regarding taxation, Mr. Bhat ardently supports a reduction in Goods and Services Tax (GST) rates on hotel room tariffs. He proposes a decrease from 18% to 12% for room tariffs exceeding INR 7,500, asserting that this adjustment would enhance competitiveness and benefit both consumers and hotel businesses.

One of his primary expectations is an increase in the income tax exemption slab for individuals. Mr. Bhat suggests a new threshold of INR 10 lakhs, emphasizing the industry’s reliance on manpower and deeming this adjustment pivotal for the sector’s financial health.

In terms of employee benefits, Mr. Bhat advocates for an augmented House Rent Allowance (HRA) for Bangalore, proposing an increase from the current 40% to 50%. Recognizing Bangalore as a fully grown city, he argues for metro-level consideration to attract and retain talent within the hospitality workforce.

Streamlining operational processes is a core focus for Mr. Bhat, who calls for a simplified, one-nation, one-license framework. He believes this reform would alleviate the burdensome process of obtaining municipal, state, and central licenses, fostering a more conducive environment for business initiation.

Highlighting broader industry concerns, Mr. Bhat stresses the necessity of a dedicated ministry for the hospitality sector. He contends that such a ministry would offer focused support crucial for sustaining growth, attracting investments, subsidies, and generating employment opportunities.

Additionally, he advocates for an annual Leave Travel Allowance (LTA) to encourage domestic tourism, departing from the current biennial cycle.

As the Union Budget 2024 approaches, these expectations mirror the sector’s aspirations for comprehensive policy adjustments that address immediate financial concerns and pave the way for sustainable and resilient growth.

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