Centre's plan to open up homestays as a way to bridge the acute deficiency of hotel rooms may backfire as such services are not standardised or regulated, the Hotel and Restaurant Association of Western India (HRAWI) said today.
"In India, tourism is at a nascent stage and promotion of homestays at the expense of organised hospitality could spell doom.
"The main problem with homestays is that there are no standardisations. There have been cases of exaggerated promises, misrepresentations, disagreements and conflicts with guests, among others," HRAWI and Federation of Hotels and Restaurants Association of India (FHRAI) President Bharat Malkani said in a release issued here.
The proposal allows anyone to offer stays at their homes, which will have no government intervention and will not attract any kind of taxation or commercial tariffs, he said.
The hotel industry feels such a plan could backfire with no assurance of guest safety and would have consequences that affect employment and tax revenues, he said.
As homestays are unregulated, there are no redressal systems in place, Malkani added.
The solution to growth of tourism in India is freeing the hospitality sector from red tapism and following a pragmatic taxation policy, HRAWI former President Kamlesh Barot said.
"If this homestays concept does go into execution then hotels, operating with the highest taxation applicable in addition to paying for utilities such as water and electricity at commercial rates, are bound to be doomed.
"Tourism cannot afford to prosper without hotels and the government will have to consider an alternate plan that can either allow hotels to operate with the same relaxations as given to homestays or vice versa," Malkani said.
