Relief for beleagured tourism industry

The ministry in a statement said the government had decided the recovery of loans provided for tsunami-affected hotels to be deferred to temporary and all moratoriums on capital payments to be considered on condition that the interest be paid regularly.

The Tourism Ministry on Wednesday announced a temporary relief package for the struggling tourism industry for immediate implementation

The ministry in a statement said the government had decided the recovery of loans provided for tsunami-affected hotels to be deferred to temporary and all moratoriums on capital payments to be considered on condition that the interest be paid regularly.
The application of penal rates on debit servicing to be suspended while VAT payable on tourism operations has been deferred by a year with no penalty on delayed VAT payments from April 1, 2007 to March 31, 2008. Payment of VAT liabilities for this period has been extended till June 30.

Furthermore approval has been granted to dispose of vehicles imported under the duty free scheme without payment of penalty duty so as to enable alternate cash generation for companies in trouble.

The decisions were taken at a meeting with private sector industry officials chaired by Tourism Minister Milinda Moragoda.

Last week The Sunday Times highlighted the crisis in the industry where 2,000 hotel rooms have closed, occupancy levels have hit an all-time low in Colombo and outside, tourism revenues are down by 20 percent and 1,500 casual and contractual workers have been laid off. The report said the Tourist Hotels Association (THASL) and the Sri Lanka Association of Inbound Tour Operators (SLAITO) had written to Moragoda urging immediate relief measures.