New Delhi, Jan 18 (IANS) A leading industry lobby has advocated a five-year tax holiday for hotels including five-star establishments in and around the capital to expedite hotel room construction before the 2010 Delhi Commonwealth Games. The Union budget of 2007-08 provides a five-year tax holiday for two-star, three-star and four-star hotels and convention centres in Delhi, Faridabad, Gurgaon, Gautam Budh Nagar (Noida) and Ghaziabad.

But industry lobby Associated Chambers of Commerce and Industry of India (Assocham), has said this concession needs to be extended to all categories of hotels including five-star hotels to ensure adequate capacity expansion to cope with the tourist influx during the Games.

Assocham said expansion of hospitality infrastructure has not taken off, especially in the five-star category, where it believes the bulk of tourists is likely to stay.

Assocham secretary general D.S. Rawat said the hospitality industry should be extended the “infrastructure sector” status as it is capital-intensive, with five-star hotels requiring capital investments ranging from Rs.300 crore to Rs,500 crore (Rs.3 billion to Rs.5 billion).