Tourists visiting the sunny beaches of Goa this year will have to shell out more for their vacation as the state government has proposed to increase taxes on hotels travel and alcohol in the state budget , which kicks in from August this year.The government has imposed a luxury tax of 6% on hotels quoting prices as low as Rs 751 for a night’s stay in a bid to reign in establishments renting out rooms for less than Rs 1,000 through online portals, thereby causing a loss to the exchequer. The government has also fixed the luxury tax on rooms exceeding Rs 3,000 and Rs 5,000 at 9% and 12%, respectively."The budget has not been favourable for the tourism and hotel industry as Goa will become an expensive proposition for travellers, with increase in taxes on various elements of travel such as hotels and flights," said Martin Joseph, chairman - Indian Association of Tour Operators, Goa Chapter. "The additional cost burden will be ultimately passed on to the traveler, who will feel the pinch."The government has proposed to increase the VAT on aviation turbine fuel (ATF) to 18% from 12.5%, which is likely to make air travel out of Goa expensive. According to industry estimates, the increased taxes on hotels and ATF are likely to make vacation in Goa dearer by around 10-15%."Goa is facing stiff competition from south-east Asian countries which are offering price sensitive rates and their governments are helping tourism grow with good infrastructure. Goa, on the other hand, lacks infrastructure for tourism and this increase in taxes on different travel elements will further dent its tourism prospects," said a hotelier, who owns five-star property in the state.Hoteliers said that tourism is one of the top revenue generators for the state government. However, the government has allocated only Rs 130 crore for tourism marketing and tourist infrastructure development, from a total budget layout of Rs 14,694.2 crore.The increased taxes are likely to impact the number of tourists visiting Goa. "While international markets are enjoying the exchange rate benefits, domestic travellers will feel the impact of the overall increase in travel expenses," said Tirthram Arondekar, chief financial officer at five-star property Resort Rio in Goa.Another major blow for the hotel industry in Goa is the reduction in exemption of luxury tax on hotels during the off season -- June to September -- to 25% from 60% earlier. During the off season, when foreign travel dips, leisure hotels typically attract the domestic travellers."The minute this subsidy is reduced during the off season, it will have an adverse impact on domestic market which is highly value and price conscious," said Shridhar Nair, general manager at The Leela, Goa. "In this case, hotels may have to rework their rates and hold on to the price increase, but this will definitely hit their rates and margins, which are very thin."In the past few years, Goa has seen a decline in foreign tourist arrivals, with Russia -- one of its major international source markets -- witnessing a huge decline on account of its falling currency and economic crisis. According to Joseph of IATO's Goa chapter, international tourist arrivals have seen close to 40% dip in the past one year. And measures like these are expected to further dampen the numbers.Goa budget plays spoilsport to its tourism prospects# 6% Luxury Tax on rooms priced as low as Rs 751 a night# 9% Luxury Tax on rooms priced over Rs 3,000 and not exceeding Rs 5,000# 12% Luxury Tax on rooms price over Rs 5,000# Reduction in exemption of luxury tax on hotels during the off season - June to September - to 25% from 60% earlier# Alcohol set to cost more due to revised excise duty on Indian Made Foreign Liquor (IMFL) and beers, that are imported or sold in the state. The tax could vary from Rs 20 to Rs 3,400 per bulk litre, which may directly reflect in retail pricing.#Flying out of Goa may become dearer with proposed increase of VAT on ATF(jet fuel) from 12.5% to 18%Entertainment:# Goa Entertainment Tax Act revised enabling it to hike the entry fee to Casino’s from Rs 700 to Rs 1,000.