Grand Hyatt hotel project deadline extended until 2022

COLOMBO (News1st): The deadline for the completion of the much-delayed Grand Hyatt Hotel project - accused of causing massive losses to the government - has been extended until 2022. The project comprising 475 roomed hotels with 90 apartments along Galle Road in Colombo 03, was initially due to be completed in two years from July 19, 2012. This deadline has been extended for the third time, until December 19, 2022, a directive signed by Prime Minister Mahinda Rajapaksa as finance minister, seen by News1st, showed. Delayed progress has already increased the cost of the project from Rs 30 billion to Rs 60 billion, according to a statement published by the government this month. "...most of the agreements signed by the previous government were terminated by the new board of directors of the Sino Lanka (Pvt) Ltd .... without any justifiable reason," the government declared. Sino Lanka (Pvt) Ltd - a subsidiary of Sri Lanka Insurance Corporation, Employees' Provident Fund and Litro Gas Lanka Ltd - has been carrying out the project since its inception. The government has said that a committee would be appointed to investigate the losses caused to the state coffers by the project. In 2012, the government offered massive tax concessions for the project including a waiver on Value Added Taxes, Ports and Airport Development Levy, and the Customs Duty. An exemption of income tax for 10 years from the first year of earning profits or three years after beginning commercial operations, whichever falls first, was among the concessions. Withholding Taxes were also exempted under certain conditions on foreign loans, technical fees for consultants and any payments made to Hyatt Hotel Corporation, USA or its subsidiaries.