Bid to boost tourism in NE

GUWAHATI, April 24 ? In a written reply to Sri P Prabhakar Reddy in the Rajya Sabha, the Minister of Tourism and Culture, Sri Jagmohan said that in order to boost the flow of tourists in the country, the Government in its budget proposals for 2002-03 has announced the following tax concessions:

l Exemption of air travel tax from and to North East.

l Service tax exemption given earlier to be extended for one more

year. In cases of functions and banquets where the entire bill is

for catering services, no service tax would be charged.

l Expenditure tax on hotels henceforth to apply only to room

charges.

l Threshold of Rs 2000 raised to Rs 3000 for levy of expenditure tax.

l Disparities between 80 HHC and 80 HHD of the Income Tax Act

removed (under Section 80 HHC the exemption is for 100 per cent

of the total foreign exchange earnings. But for hotels, under

Section 80 HHD it was 50 per cent and the balance 50 per cent

was exempted if it was kept in a reserve and used for specified

purposes). Now this disparity stands removed.

l Deduction of 50 per cent of profits earned by units setting up

convention centres will be allowed for 5 years under Section 80 IB

of the Income Tax Act.

l TDS under Section 194 H of the Income Tax Act reduced from 10

per cent to 5 per cent.