Jharkhand Tourist Tax: Chamber Warns of Impact on Hospitality Sector

Ranchi: The Federation of Jharkhand Chamber of Commerce and Industries (FJCCI) on Saturday urged the state govt to reconsider the recently approved city tourist tax, warning that the levy on hotel stays could hurt Jharkhand’s tourism and hospitality sectors and raise costs for travellers.

The concern follows the Jharkhand cabinet’s approval of the Jharkhand City Tourist Tax Rules, 2025. Following cabinet nod, it will probably be taken up during the next session of the assembly for its passage post which it will have to sent to the governor. Once assented by Raj Bhavan, the rules will come into force.

Under the new rules, tourists staying in urban hotels would pay an additional tax linked to the GST category of the hotel. As per cabinet details shared after the decision, domestic tourists may pay 2% to 5% extra on hotel bills, while foreign tourists could be charged 4% to 10%.

Chamber representatives on Sunday said the hospitality sector is already paying GST between 5% and 18%, and another levy could make hotel accommodation more expensive. FJCCI general secretary Rohit Agarwal said the proposed tax runs contrary to the spirit of the GST regime.

“The GST system was introduced with the principle of ‘One Nation, One Tax’. Imposing another tax on hotel stays may create an unnecessary burden on both hotels and consumers,” he said.

The chamber also met hotel operators, many of whom voiced concern over the likely impact on occupancy and tourism growth.

“Jharkhand is still developing its tourism market. Any additional levy may discourage budget travellers, business visitors and event organisers from choosing the state,” said Rajeev Sinha, a Ranchi-based hotel operator.

Industry representatives said the move may hit mid-range and small hotels the hardest, as they rely heavily on domestic travellers. They argued that tourists compare total accommodation costs while planning trips, and even marginal increases can influence decisions.

Reema Singha, a travel blogger from Dhanbad visiting Ranchi, said the levy could alter travel choices, especially for budget-conscious tourists and content creators.

“Travel bloggers and regular travellers often stay in multiple hotels during short trips. Even a small increase in accommodation costs adds up over time. Many travellers compare hotel prices carefully while planning weekend trips, and higher tariffs may push them towards cheaper destinations outside Jharkhand,” she said.