Despite the government increasing VAT and luxury tax, city hotels aren't upping their rates, making hotel stays in the Garden City quite affordable
Despite the government increasing VAT and luxury tax, city hotels aren't upping their rates, making hotel stays in the Garden City quite affordable
Following stiff competition and the impact of economic slowdown that's still looming large over the hospitality industry in Bangalore, the Silicon Valley of India has become a heaven for those planning for a holiday here.
Hotels across the city have slashed their room rates, thus making stay in Bangalore quite affordable.
"Even though the government has increased the Value Added Tax (VAT) on food by 1 per cent (12.5 to 13.5 per cent) and luxury tax on rooms by 2 per cent, we have decided not to increase the rates of hotel rooms," said Mohd Shoeb, general manager of Royal Orchid Central Hotel.
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| A room in a city five star hotel will cost you anything between Rs 7,000 and Rs 11,000, while the one in a four star hotel costs about Rs 4,000. |
J P Menon, VP and general manager of St Mark's Hotel, said, "As there's not much business, the competition has increased many folds.
The hotels are leaving no stone unturned to woo tourists and are offering flexible room rates this season.
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Although the luxury tax on hotel rooms has been increased from 10 per cent to 12 per cent, no hotel has increased its rates."
Citing increase in the number of domestic flights as one of the reason for the fall in room occupancy, Shyam Raju, president of Hotel and Restaurant Association (Southern region), said, "As there are so many flights available daily, those travelling for a day don't prefer staying back.
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This has affected the occupancy rate to quite an extent."
He added, "A couple of years ago, around 90 per cent of the rooms used to occupied but now, the occupancy has reduced to 60 per cent."
Meanwhile, some hotels in the city have witnessed an increase in business.
Andrew Hendrian, GM of Hotel Leela Palace, said, "As the occupancy has started picking up, we have marginally increased our room rates." At present, the hotel witnesses room occupancy of about 82 per cent.
