Hotel strike to send strong signal on GST tax slab

A spokesperson from the hospitality association said, “The hospitality and hotel Industry has been reeling under economic woes since 2009. Recently, the Supreme Court came out with a judgement banning any liquor sales within 500 metres of National and State highways, crippling the business of hotels which are located on arterial roads. While the industry was trying to come to terms with this issue, the Finance Minister dropped another bomb shell – fixing the GST rates on Restaurants and hotels from 12 to 28 per cent.” 

The spokesperson remarked, “The recent developments and policies belie the importance of our industry. Policymakers have failed to recognise us as one of the largest job creators and net foreign exchange earners with growth fuelled by the rising middle class. The ordinary and non-star standalone restaurants and eateries cater to the middle and lower income sections of society, which constitute a major percentage of this sector. Many states like Tamil Nadu, Kerala and  Puducherry have recognised the significance of this section and have extended concessions of as little as 2 pc levy under the State VAT Acts.”

Despite numerous representations and memorandums to the authorities, the Government has proposed a levy of between 5- 18 % on the different categories of restaurants and the highest rate applicable for the industry is a steep levy of 28 pc GST on hotels with room tariff above Rs 5,000. “We want to register our protest and send a strong signal to the Government against the proposed levy of GST rates in the hospitality industry. All major hotel associations in South India have pledged their support for the proposed strike,” the officer bearer said. The GST Council is scheduled to meet again on June 3.