Minister of Tourism, Prasanna Ranatunga says that two special Cabinet Memoranda will be submitted to revise the taxes levied by the local government institutions on tourist hotels, restaurants and lodging houses and to extend the moratorium on electricity bill payment. He states that the Cabinet Memorandum on the revision of the taxes levied by the Local Government Institutions will be submitted to the Cabinet jointly with the Minister of Public Service, Provincial Councils and Local Government. He also said that the Cabinet Memorandum to extend the moratorium on electricity bill payment has already been drafted.

Local Government Institutions are authorized to impose and levy a license duty on the turnover of a hotel, restaurant or lodging house registered with the Tourism Development Authority for the year proceeding the year in which the license duty is levied, not exceeding 1% of such turnover. As a result, they have to pay a significant amount of their annual income to the local government institutions. In addition, other taxes and waste disposal taxes are also paid by the relevant tourism entities to the local government institutions and it is expected to revise the tax, taking this situation into consideration, said Minister Prasanna Ranatunga.

In addition, arrangements have been made to submit a Cabinet Memorandum on further extension of the moratorium granted by the Ceylon Electricity Board on electricity bill payment of tourist hotels, restaurants and lodging houses. Accordingly, it has been proposed to extend the moratorium granted initially from March 1, 2020 to February 28, 2021 until the end of this year on electricity bill payment and to align the unit price of electricity tariffs in peak hours in the hotel industry in line with other industries.

Accordingly, it is proposed to provide relief for tourist hotels, restaurants and lodging houses registered with the Tourism Development Authority to pay all the outstanding accumulated electricity bills from March 2020 to December 31, 2021 in 36 equal installments with effect from the 1st January 2022 and to request the Ceylon Electricity Board not to disconnect the electricity supply until the end of that period.

“The relevant Cabinet Memoranda will be submitted to the Cabinet very soon for its approval. Taking into consideration the requests made by those involved in the tourism sector, these two Cabinet Memoranda will be submitted. It is expected that the gradual recovery of the tourism industry will address the problems faced by those involved in the sector. The number of tourists who arrived in the country from January to December 5 this year was 115,190.  And, 10, 201 tourists have arrived in the country in the first five days alone from 1st to 5th December. The tourists have come from India, Russia, the United Kingdom, Germany, Australia, Kazakhstan, the United States, France, the Maldives and Spain,” the Minister said.