It is the world’s 10th most visited city. But unlike other tourism hotspots, visitors do not prefer to stay back in Amritsar. If they do, a room above Rs. 200 a night costs them 8% luxury tax — doubled from 4% by SAD-BJP’s previous regime — that goes to the state’s kitty.
This is in addition to 7.42% service tax that goes to the Centre. Value added tax (VAT) on food at most hotels is a whopping 14.3-19.25%. Amid this, heritage sites are in a shambles, sanitation poor, infrastructure deplorable.
The situation has remained so through the seven-year rule of the SAD-BJP in the state and two terms of BJP MP Navjot Sidhu. As BJP stalwart Arun Jaitley seeks election from the constituency, he is now promising sops to relieve the burden of taxes imposed by the alliance of his party with the Akali Dal.
“When our regime comes to power at the Centre, I will propose that Amritsar be included in the 50 tourism circuits. To boost tourism, you need less tax, so we will curtail the levies. If needed, we will ask the state government to do the same,” Jaitley told HT.
His Congress opponent and former CM Capt Amarinder Singh, too, is promising to boost tourism, albeit by promoting trade with Pakistan and Central Asia and restoring heritage sites.
But even as Jaitley is pegging the promises to a BJP-led NDA government at the Centre, the once-booming hospitality industry of the holy city is not convinced.
The Amritsar Hotel and Restaurant Industry Association claims many hotels are on sale, including five-star properties. While one five-star has already exchanged hands — Ananda Group sold Ista Hotel to Hyatt — another is on the block.
“Hotels are forced to offer rooms at up to 50% discount owing to high taxes. The BJP is now promising to boost tourism and improve infrastructure, but in the last seven years the ruling Badals did not let Sidhu do anything, and did nothing.
Textile industry of Amritsar has moved out to Surat in Gujarat and other states. The only industry left here is hospitality,” said APS Chatha, president of the association.
“Is getting a room above Rs. 200 a luxury? You do not even get a pizza for Rs. 200!” he added, “And what luxury is the state government providing after imposing luxury tax? Sanitation and infrastructure are poor.
Even the Punjab Tourism Board started a ‘heritage walk’ that had to be discontinued as tourists did not want to see the filth around.”
He credited Sidhu for being “instrumental in starting flights at the international airport and getting the freight cor ridor extended up to Amritsar”: “But they threw him out. Jaitley knows the lapses of his party and the ally, and is now promising to undo them.”
The association claims that yet another, “beautification tax” was proposed to be levied by the municipal corporation. “That would have been Rs. 200 per room booking. We met deputy CM Sukhbir Badal and the plan was kept on hold till elections.
Why should tourists pay for beautification? Is it not the government’s job anyway? An annual ‘conservancy tax’ is also billed to hotels and restaurants by the MC on the basis of per square foot area. No other municipal body has this levy to remove garbage,” Chatha added.
Property tax has dealt another blow and, unlike luxury tax and VAT that afflict only hospitality industry, this resonates among voters of all income groups and has snowballed into a poll issue.
Both Jaitley and Capt Amarinder have blamed the respective governments for imposing it.
Another hotel owner said on the condition of anonymity that “there has been total apathy” towards developing Amritsar’s tourism: “Tourists just visit the Golden Temple, Jallianwala Bagh and the Attari-Wagah border.
There are many tourist attractions that are in ruins and are not well-known. No effort has been made to spruce up, say, Maharaja Ranjit Singh’s summer palace, Hanuman Mandir, or Gobindgarh Fort.
Contrast this with Rajasthan, where heritage sites have been well-preserved. No other religious destination, be it Shirdi or Tirupati, has such high taxes. Even Goa offers rebates during lean season. But Amritsar is a destination where tourists get no facilities, yet have to pay high taxes.”