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Delay in tax policy hits Bed & Breakfast scheme

Since the Union Tourism Ministry launched this scheme, it has only 120 applications from parties.
PTI | By HT Correspondent, New Delhi
UPDATED ON MAR 26, 2007 12:34 PM IST

Confusion over whether they would be charged commercial or domestic taxes while opting for the "Bed and Breakfast" scheme, launched to tide over shortage in lodging facility during Commonwealth Games in 2010, is keeping Delhiites away from vying for the venture.
Ever since the Union Tourism Ministry launched the scheme in November last, the ministry has received only 120 applications from parties offering their houses to double up as tourist lodges.

"People are hesitant because the Delhi government is yet to finalise its taxation policy on the houses giving such facility," a senior official in the Tourism Ministry told the agency.

There are several types of taxes, electricity tax, property tax, water tax and the parties are not sure whether they will be charged commecial tax rates or domestic tax rates, the official said.

Delhi also has luxury tax if establishments like hotels are started, which would add to the tax burden on the entrepreneur.

"There are other factors also which could be keeping people away from the scheme. That is apprehension about accommodating a stranger," he said.

"Indian family value system is such that people are generally wary of keeping a stranger in the house. Also it is altogether a new concept in India, though Bed and Breakfast is a common thing in the West," the official said.

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