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‘Illegal tourism’ eating into our profits, complain small hoteliers



After illegal mining, the next crisis heading the state government is likely to be ‘illegal tourism,’ claim local tourism industry stakeholders.

Stakeholders comprising mainly of small and medium-sized hotels and guest house owners said Monday that illegal tourism is making the state lose revenues and lowering business of small hoteliers.

They said that the illegal sector is on par with legitimate players in terms of room capacity and accounts for 50 per cent of accommodation in the state. “The illegal entities comprise real-estate sharks from other states who, under the garb of building houses, use the rent-back business model to be a participant of the tourism industry,” said stakeholders.

“The only permission the builder takes is a no-objection certificate (NOC) from panchayat to operate one villa within the complex as hotel. But by using the remaining empty flats in the complex the builder actually runs a 60-room property,” they alleged.

According to the small hoteliers, most of the gated residential complexes in the beach belt function as hotel rooms but are outside the purview of the state Tourism Trade Act.

“They do not take consent from the state pollution control board, pay no licensing fee to the excise department or GST, receive water and electricity supply at non-commercial rates,” said Serafino Cotta, president, Small and Medium Hoteliers Association (SMHA).

He said that unregistered players and unplanned tourism are the main reasons for the hospitality industry’s poor showing in the ongoing

season. “Occupancy dropped to less than 50 per cent on the peak days with rooms going as low as Rs 900 per night. It is an unheard of tariff for Goa,” said Cotta.

According to SMHA, online travel companies are also a part of the unregistered sector. “Online travel companies have been banned in Gujarat and Sikkim and must also be banned in Goa,” said Antonio D’Souza, a small hotel owner and secretary of SMHA.

Members of the association said that they account for 85 per cent of the room capacity in the state and are also the biggest employers but are the most taxed, thanks to being licensed players.

“The issues facing the tourism industry have been building up and the current season’s decline in tourist arrivals is a result of the build-up,” said Pifran Fernandes, joint secretary, SMHA.

He pointed out that liquor wholesalers selling alcohol in the retail market is another problem faced by members. “Tourists are purchasing liquor directly from wholesale outlets and not from us because of which we cannot recover our liquor licence fee,” claimed Fernandes.

The SMHA is demanding setting up of a Tourism Tribunal to address grievances and other issues like rollback in excise fees for category C hotels and guest houses, guidelines for wholesale liquor vendors by the excise department and fire NOC for five years.

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