India plans tax cuts, incentives for travel and tourism sector

Domestic and foreign tourists walk in front of Humayun's Tomb, one of the tourist destinations in New Delhi. Over 9 million foreigners visited India in the first 11 months of 2017, up 15.6 percent from a year ago. (Reuters)
Updated 05 January 2018
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India plans tax cuts, incentives for travel and tourism sector

NEW DELHI: India is planning to cut taxes on travel and tourism in next month’s federal budget and give more incentives to the $210 billion sector, government sources said, hoping to boost economic growth and create more jobs.
The move could add to a domestic tourism boom in the world’s second most populous nation, where low inflation and rising incomes are changing lifestyles and consumption patterns of an estimated 250 million middle-class Indians. With scores of destinations introduced on airline routes last year, air travel is also surging.
India’s tourism sector grew over 10 percent in the six months ending September, compared to near 8 percent in the year-ago period. According to an industry report, tourism employs 40 million people in India and could add 10 million jobs in a decade.
“We’ll announce measures in the budget to promote investment in the tourism sector,” a top finance ministry official told Reuters, adding that Finance Minister Arun Jaitley favors lowering a 28 percent tax on hotel tariffs, and offering incentives to attract private investments.
If the moves come about, companies expected to benefit include airlines like IndiGo, owned by InterGlobe Aviation , and Jet Airways and hotel operators such as Indian Hotels, that owns the Taj Mahal chain and EIH Ltd. that operates the Oberoi hotels in India.
Tour operators including Cox & Kings and Thomas Cook are also likely to gain.
In India tourists, on average, pay 30 percent tax on hotel rooms and travel compared with less than 10 percent in Singapore, Thailand and Indonesia, said Pronab Sarkar, president of the Indian Association of Tour Operators (IATO).
Another government official said the budget was likely to “significantly” raise allocations for tourism infrastructure and raise income tax exemptions on investments in new hotels.
A third official, who is aware of the finance ministry’s pre-budget consultations with industry groups, said Jaitley was expected to lower income tax on corporate profit, offer tax incentives on hotel construction, allocate more funds for new tourist trains and building roads to tourist destinations.
The government will offer incentives to more regional airlines this year to cover new, under-served airports, the official added.
All three officials, who spoke on condition of anonymity, declined to provide numbers or share further details.
India needs about 200,000 new hotel rooms, Tourism Minister K.J. Alphons told parliament this week.
“We have reached a plateau point and need more resources to create new infrastructure and develop tourist packages,” Alphons later told Reuters, adding there was huge potential in developing areas that were not the usual tourist destinations.
Prime Minister Narendra Modi has said developing tourism, particularly in India’s remote north-eastern states, is one of his top priorities.
Hotel occupancy levels in India are at their highest levels since 2008, even though many hotel chains have raised prices.
The need for rooms has been spotted by foreign investors with Japan’s SoftBank Group backing start-ups like OYO Rooms, which has emerged as the largest aggregator of budget accommodation across the country with hotels in over 200 destinations.
One major driver of the domestic tourism boom has been the launch in 2017 of five regional budget airlines on over 100 routes, which are given incentives by the government to offer cut-price flights to uncovered and remote areas, encouraging thousands of families to explore flying for the first time.
Domestic airlines carried 10.6 million passengers in the first eleven months of 2017, up 17 percent from the year-ago period — encouraging some established players like Spicejet , Jet Airways and Vistara, a joint venture between the Tata Group and Singapore Airlines, to start flights to new locations.
Tour operators said double-digit hikes in urban wages, coupled with an over 25 percent rise in the benchmark Sensex index last year, have contributed to the domestic tourism boom.
At the same time over 9 million foreigners visited India in the first 11 months of 2017, up 15.6 percent from a year ago.
Domestic tourists, who account for 88 percent of the sector, are increasingly using online portals for hotel and travel bookings.
Travel portal MakeMyTrip reported a 186 percent jump in hotel bookings during the September quarter and its holiday package segment that includes hotel and flight bookings, saw a 71 percent increase in revenues over the same period.
Online operators say tourism could emerge as the new engine of growth after the IT sector but that it needs government support.
“The government must lower the tax burden, ease rules and build infrastructure if it wants to ensure 15-20 percent annual growth in tourism in coming years,” said Sarkar of IATO.


The Phoenicia: A still-seductive reminder of Beirut’s golden age

The hotel was named Lebanon’s leading hotel for 2018 at the World Travel Awards. (Photo supplied)
Updated 21 July 2018
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The Phoenicia: A still-seductive reminder of Beirut’s golden age

  • For those in search of glamor, almost every night the wealthy, the stylish and the overdressed can be seen exiting luxury cars
  • The hotel’s immediate interior is dominated by marble pillars, plush armchairs, fountains and chandeliers

BEIRUT: Of all Beirut’s hotels it is the Phoenicia that looms largest in the imagination. Opulent, brash, sexy, seductive, it is a reminder of what was and what could have been.

It’s hard not to look favorably upon its delicately perforated façades and its shimmering blue and turquoise tiles. It somehow manages to maintain a sense of mystique, a sense of otherworldliness, despite the chaos that frequently unfolds around it.

Much of this, of course, is down to nostalgia. Opened in 1961 at the dawn of Beirut’s Golden Age, the singer Fayrouz performed here in 1962, as did the Egyptian dancer Nadia Gamal. Brigitte Bardot, Claudia Cardinale and Omar Sharif were guests, while the Lebanese beauty queen Georgina Rizk was photographed by the hotel’s oval-shaped pool in 1971.

In many ways the Phoenicia still clings to the remnants of its pre-war heyday, living as much in the past as it does in the present. When the hotel was resurrected from the ashes of civil war in 2000, it clutched much of its original design and character close to its chest, with a further $50 million refurbishment undertaken to mark the hotel’s 50th anniversary in 2011. It is the end result of this later refurbishment that is primarily on display today.

The hotel’s immediate interior is dominated by marble pillars, plush armchairs, fountains and chandeliers, and hovers dangerously close to the ostentatious. Elsewhere it borders on the dowdy or the old-fashioned. Yet a grand and elegant staircase continues to welcome visitors, while lanterns and geometric patterns lend a slight but satisfying sense of location.

Outside, the swimming pool — once an oval-shaped beauty — is set against a backdrop of cascading waterfalls. It is more politically correct than its 1960s predecessor, under which could be found a subterranean bar called Sous la Mer, but it is nevertheless at the heart of much of the hotel’s continued appeal.

From the shade of the pool’s colonnades you can see the old St. Georges Hotel, designed in the 1930s by Parisian architect Auguste Perret, while Zaitunay Bay and the edge of the Mediterranean are a stone’s throw away. It is because of this location and these views that the Phoenicia retains much of its appeal, regardless of its 446 rooms and suites, spa, shopping arcade and banqueting area.

Of the hotel’s three buildings, it is the original, designed by the architects Edward Durell Stone and Joseph Salerno, that is the hotel’s aesthetic pinnacle. Combining elements of high modernism with Mughal and Muslim architecture, it is where you should stay if given the choice.

You buy into many things when you stay at the Phoenicia, which was named Lebanon’s leading hotel for 2018 at the World Travel Awards. History, of course, and location, but also a level of abundance that is not readily available elsewhere in the city.

Breakfast is a fabulous affair. Manakish are freshly cooked on a dome oven, eggs are prepared in front of you, while separate stations serve everything from a dizzying array of olives and salads to cheese, labneh, foul, sausages, honey and smoked salmon. There’s even Oum Ali and kanafeh.

For those in search of glamor, almost every night the wealthy, the stylish and the overdressed can be seen exiting luxury cars and heading to all manner of social gatherings. They dine at the Mosaic and Amethyste restaurants, or at Eau De Vie, a lounge bar and grill situated on the 11th floor. None of this, of course, is cheap. If nothing else, the Phoenicia experience comes at a price.