Drop In Luxury Tax, Hike In Gambling Levies: Goa Budget

Savio Rodrigues - Mumbai

Hotels and restaurants in Goa are breathing a sigh of relief, with the state government, in its budget which was approved recently, reducing the luxury tax levied on the hospitality industry. However, the application fee has been increased for installation of amusement and slot machines for casino-based activities in various hotels and so also the annual recurring fee of off-shore casinos.

Previously, luxury tax was charged at slabs of five per cent and eight per cent based on the classification of the hotel. However, only 50 per cent is charged during the off-peak period of six months from June to October. But, for the current financial year, the government has extended the off-peak period to nine months from March to November. “So while luxury tax will be increased during the peak period of December to February from eight per cent to 10 per cent in the Category A of three-star hotels and above, it will be dropped to three per cent during off-peak season across all categories of hotels. But, most importantly the B-Category of hotels will be levied a luxury tax of three per cent throughout the year instead of five per cent,” revealed Arlindo Pereira, the new director of tourism, department of tourism, Goa.

The budget has however come as a dampener to hotels who wanted a stake in the state’s increasing gambling industry. In a bid ‘to discourage gambling and to partially recover concessions given in luxury tax’ the government has increased the application fee on up to 20 electronic amusement and slot machines in five-star hotels and on board off-shore vessels from Rs 5 lakh to Rs 10 lakh. Similarly, the annual recurring fee for off-shore casinos has been increased from Rs 50 lakh to Rs 1 crore and the deposit towards new applications for casinos has also been increased from Rs 5 lakh to Rs 10 lakh.