Estimates additional revenue amounting to almost Rs 50 lakh as a result
the goan I network
MARGAO
Margao-based hoteliers, beware. A tie-up with OYO may have raked in additional business for city-based hotels, but the Margao Municipal Council has brought all tie-ups with India’s largest hotel network, under its scanner to mop up revenue by way of house tax.
The MMC’s initiative may come at a time when the hotel industry is clamouring for a reduction in GST.
But, MMC Chief Officer Sidhivinayak Naik appears hell bent on recovering revised rent in the form of house tax from hotels which have tied up with OYO. Failure to cough up the revised rent may attract penalty, including disconnection of power and water supply to these establishments.
The Chief Officer’s action is based on the rationale that since hotels enter into an agreement with OYO by giving their rooms on rent, the house tax get revised, as he insisted that 10 per cent of the annual rent should come to the MMC by way of house tax. As per rough estimates done by the Chief Officer, the civic body may be richer by around Rs 50 lakh going by the present room tariff.
“Many city hotels have a tie-up with OYO and there’s nothing wrong with that. But, there’s no communication made with the MMC. Since hotel owners are giving their rooms on rent, irrespective of the rent, the house tax get revised. Around 10 per cent of the annual rent should come to the MMC as house tax,” he told the media.
The Chief Officer has so far dispatched notices to the OYO management, seeking details of all the city-based hotels that have tied up with the hotel network. So far, the civic body has identified around 12 hotels which have entered into a tie-up with the hotel network.
To a question, the MMC Chief Officer said the civic body would like to give sufficient time to OYO to respond to notices before they being to cut off power and water connections. “We had issued notices giving OYO seven days to provide all details concerning the agreement with the hotels. We were not in a hurry to go for immediate action because of the intervening festive season. We don’t want the business of the hotels to get disturbed as the tourism season is just about to start,” he said, while calling upon the hoteliers to come forward and cooperate with the civic body.
Naik, however, warned that the civic body would crack the whip against the hotels if they don’t comply with the contents of the notices.
When it was suggested that the MMC will be charged for double taxation given that the hoteliers are already paying house tax for the rooms, Naik shot back,”What we have proposed will not amount to double taxation. We only want the hotels to pay the revised house tax in view of the fact that they have entered into an agreement with OYO to lease out their rooms.”
To another question, he pointed out that of the 12 hotels identified by the civic body as having tied up with the hotel network, three of these hotels do not pay any tax nor have any permissions from the civic body.
