Himachal body calls for scrapping of tax on commercial vehicles bringing tourists from outside

Shimla/Manali: Himachal Pradesh can do away with taxes imposed on commercial vehicles bringing tourists from other states to boost the sector, the state's hotel and restaurant association has said.

Citing example of countries that offer free tourist visas to attract visitors, President of the Federation of Himachal Hotels and Restaurant Associations (FOHHRA) Gajender Thakur in a letter to Chief Minister Sukhvinder Singh Sukhu said Himachal can do away with the tax imposed on commercial vehicles bringing tourists from other states.

"Himachal Pradesh could set an example by... doing away with the tax imposed on commercial vehicles bringing tourists from other states," he wrote.

"By attracting more tourists, the state can significantly boost its economy through revenues from Value Added Tax (VAT) on petrol, diesel, liquor, and Goods and Services Tax (GST) on various services like hotel accommodation, food, shopping and consumption of fast moving consumer goods products," he said.

He said levying taxes on commercial vehicles carrying tourists from other states will further affect the state's tourism sector, which has suffered heavy losses in the recent floods.

The state transport department recently imposed a tax of Rs 5,000 per day on luxury buses that are registered in other states and are running in Himachal Pradesh.

Seeking the chief minister's attention on the issue, Thakur said at this time we should welcome tourists with open arms and reduce taxes and create a favourable environment.

The recent news of taxi and bus operators of Punjab threatening to boycott operations in Himachal Pradesh due to taxes on commercial vehicles is worrisome for the tourism industry, he said.

Gujarat, Maharashtra and West Bengal travel agents have already put us in their negative list due to these exorbitant taxes, he noted.

Imposing high taxes on tourist vehicles will discourage them from visiting our state and might lead to a loss of revenue for Himachal Pradesh as tourists tend to travel to other states.

Tourism creates employment opportunities for many people, which will also directly help the state generate revenue through taxes and eventually compensate for the tax collection from commercial vehicles, according to the letter.

The tourism industry suffered a loss of over Rs 2,000 crore in July and August as heavy rains triggered landslides and flash floods, damaging roads and other infrastructure in the state.