Hotel Association of Nepal Urges for Abolition of Luxury Tax in Next National Budget

In a recent statement, the President of the Hotel Association of Nepal (HAN), Binayak Shah, has called for the abolishment of the luxury tax imposed on hotels in the upcoming national budget. Expressing concern over the impact of the tax on the international image of Nepal’s tourism sector, Shah emphasized the need for immediate action in the next fiscal year’s budget.

Shah highlighted that the current imposition of the luxury tax has failed to resonate positively with the international community and has placed Nepal at a disadvantage compared to other tourism destinations. He urged the government to reconsider its taxation policies and focus on widening the range of taxes for tourism promotion without introducing additional burdens on hoteliers.

Furthermore, Shah underscored the importance of utilizing the country’s tourism infrastructure effectively. Despite the construction of international standard airports in Pokhara and Bhairahawa, their operationalization remains pending, hindering the growth potential of the tourism sector. Shah emphasized the urgency for government intervention to ensure swift operationalization of these infrastructures.

Reflecting on the challenges faced by the hospitality industry, Shah emphasized the need for policies that enhance occupancy rates and alleviate financial burdens on hoteliers. He emphasized that investments in the tourism sector have yet to yield expected returns, urging the government to facilitate financial relief measures for businesses struggling with loan repayments and interest obligations.

Shah also expressed disappointment over the lack of substantial progress in realizing the objectives outlined in the previous year’s budget, particularly regarding the government’s commitment to a ‘tourist decade’ and its focus on sectors like agriculture, employment, and IT. He urged for a departure from previous budgetary approaches and called for concrete initiatives to revitalize Nepal’s tourism industry in the upcoming fiscal year.