- Only 10,000 hotels registered: SLTDA
- Unregistered hotels to face legal action
Around 60% of hotels currently operating in Sri Lanka remain unregistered with the Sri Lanka Tourism Development Authority (SLTDA), according to SLTDA Chairman Buddhika Hewawasam.
Speaking to The Sunday Morning, Hewawasam revealed that only about 10,000 properties had been registered with the authority.
To address this, the SLTDA has introduced a mobile service to simplify the registration process for unregistered hotels. Previously, hotel owners had to visit Colombo in person, but now they can access the registration process through this new service.
“We are offering unregistered hotels sufficient time to complete the registration. Once this period expires, we will take firm legal action against those who remain unregistered,” Hewawasam emphasised.
He also noted that the Government was losing significant tax revenue due to unregistered hotels.
“Initially, they claimed they did not have access, but now we are providing them with an opportunity. It is up to them to register or they will face consequences,” he stated.
In addition, discussions have been held with the Police to take action against these unregistered entities. From next year, only registered hotels will be eligible for Government benefits, such as concessionary loans and promotional activities.
“We have published a list of registered entities to ensure transparency. This also ensures the safety and security of visitors staying at registered hotels. The quality and standards of these hotels are assessed during the registration process,” Hewawasam said.
Nevertheless, according to the National Audit Office (NAO), despite proposals by the enforcement unit of the SLTDA to take legal action against 504 unregistered entities identified between August 2018 and July 2022, no legal actions had been initiated by the end of the review period.
The SLTDA is now prepared to proceed with enforcement measures, pending the collection of the required evidence. However, over the past two-and-a-half years, the authority has been hindered in taking meaningful action due to Government circulars and adherence to established procurement procedures.
In a sample of 106 tourist hotels and restaurants in the Nuwara Eliya area, 66 entities – about 62% – have not been registered with the SLTDA. Although only 81 tourist entities have been officially registered, there were over 1,000 tourist establishments listed on foreign websites.
To address the impact of the informal sector on the formal sector, the SLTDA has sought assistance from the Asian Development Bank (ADB) to establish a special unit over a three-year period. However, despite some ad hoc responses, the legal department has lacked the necessary capacity to manage the issue effectively.
As a result, the authority has delegated certain responsibilities to the Tourist Police to oversee activities within the informal sector, according to the NAO.