The State government on Monday did away with the five per cent luxury tax for lodges charging daily room rents of less than Rs. 199.
An announcement in the regard was made in the Assembly.
“There will be no luxury tax for daily rents up to Rs. 499. Beyond that, the slab of 10 per cent luxury tax for rents up to Rs. 1000 and 12.5 per cent above that stays,” explained an official source.
M. Venkadasubbu, president, Tamil Nadu Hotels Association, said there were around 10,000 such lodges across the State.
“Relatives of patients at government hospitals and hawkers travelling to major towns to purchase from wholesales will benefit from this exemption. These slabs were fixed almost 15 years ago. We appreciate that the slab has been lifted,” he said.
R. Srinivasan, secretary, Tamil Nadu Hotels Association, said the association members had been continuously pitching for a revision of the slabs as Rs. 200 cannot be termed as luxury.
“These lodges would just have a cot and chair in the room with attached toilet and bath. Students from villages, coming over for examinations and interviews, would be using these facilities. This move will come as a benefit for the lower-middle class. If the threshold limit were raised to Rs. 1000, it would benefit more people,” he said.
Hundreds of people like V.K. Sivakumar, who works at Koyambedu vegetable market, stay at small lodges that charge between Rs. 75 a day (dormitories charge the bare minimum) and Rs. 500.
“When I first came from Vriddhachalam I stayed at a dormitory. There are lodges in the vicinity that charge a minimum of Rs. 400 a day, but none of us can afford these rooms. Those who come to the city for a day or two, stay at these guest houses,” he said.