The irrevocable RIPS election
Tourism units registered under RTUP 2025 automatically become eligible for Rajasthan Investment Promotion Scheme (RIPS) 2024 fiscal benefits — but must choose one track: Option I (SGST reimbursement) or Option II (capital subsidy). You cannot switch after election.
The right choice depends on projected SGST liability, eligible fixed capital investment (FCI), location category, and operating margin. High-revenue, high-occupancy hotels in Category 1 urban centres often favour SGST; capital-heavy greenfield resorts in Category 2/3 areas may favour upfront FCI subsidy.
Option comparison at a glance
| Factor | Option I — SGST | Option II — Capital subsidy |
|---|---|---|
| Rate | 75% of net SGST paid | 10% (Cat. 1) / 15% (Cat. 2) / up to 20% (Cat. 3) |
| Duration | Up to 10 years | 10 annual installments |
| Annual ceiling | Per RIPS schedule | ₹10 Cr (yrs 1–3); ₹15 Cr (yrs 4–7) |
| Best for | High room revenue, strong occupancy | High FCI, lower early-year revenue |
| Stacks with | Stamp duty exemption, double FAR | Stamp duty exemption, double FAR |
FactorRate
Option I — SGST75% of net SGST paid
Option II — Capital subsidy10% (Cat. 1) / 15% (Cat. 2) / up to 20% (Cat. 3)
FactorDuration
Option I — SGSTUp to 10 years
Option II — Capital subsidy10 annual installments
FactorAnnual ceiling
Option I — SGSTPer RIPS schedule
Option II — Capital subsidy₹10 Cr (yrs 1–3); ₹15 Cr (yrs 4–7)
FactorBest for
Option I — SGSTHigh room revenue, strong occupancy
Option II — Capital subsidyHigh FCI, lower early-year revenue
FactorStacks with
Option I — SGSTStamp duty exemption, double FAR
Option II — Capital subsidyStamp duty exemption, double FAR
Location category impact on capital subsidy
- Category 1 — developed urban tourism centres: 10% capital subsidy or 75% SGST
- Category 2 — other districts and aspirational areas: 15% capital subsidy or 75% SGST
- Category 3 / remote priority tourism areas: up to 20% capital subsidy or 75% SGST
- Heritage hotels may have modified FCI thresholds — verify RTUP heritage category rules
- Electricity duty 100% exemption for 7 years applies under RIPS regardless of option chosen
Decision framework for hotel developers
- Model 10-year SGST outflow at realistic ADR and occupancy — multiply by 75% for Option I benefit
- Calculate eligible FCI (excluding land unless specified) and apply category capital % for Option II
- Factor annual ceiling caps — large projects may not receive full theoretical subsidy in early years
- Consult CA before election filing on RSWS — revision is not permitted after submission
- Align election timing with RTUP registration and before major procurement for clean FCI audit trail
Further reading
Heritage hotel subsidy guide · Stamp duty exemption · Full Rajasthan policy guide · How to apply — Rajasthan
More Rajasthan incentive guides
Heritage hotel subsidy · Stamp duty exemption · Double FAR entitlement