PRAHA seeks revision for hotels

Rujuta Parekh
Monday, 17 July 2017

“GST of 18 per cent for either AC/heater establishments or those serving liquor is also very high. The notion of one rate one tax, as was widely advertised, is not being applied to restaurants,” the memorandum states. 

PUNE: The Pune Restaurant and Hoteliers Association (PRAHA) has submitted a memorandum to Union Human Resource Development Minister Prakash Javadekar seeking consideration for revision of the Goods and Services Tax (GST) rates for hotels and restaurants. 

In the memorandum, they have mentioned that the GST of 12 per cent for non-AC and non-liquor establishments is very high and that customers are feeling the burden. “GST of 18 per cent for either AC/heater establishments or those serving liquor is also very high. The notion of one rate one tax, as was widely advertised, is not being applied to restaurants,” the memorandum states. 

PRAHA has also raised the issue of turnover limit in the memorandum. “A turnover rate of Rs 75 lakh for availing composition scheme is very less. It is suggested that to avail composition scheme, the turnover limit must be increased to Rs 1 crore,” the memorandum explained. 

In suggestions given to the government, PRAHA stated, “GST of five per cent must be levied for non-AC and non-liquor establishments, while a GST of 12 per cent must be levied for establishments with AC/heater and liquor licence.” 

They have further stated that air conditioners are a necessity in the country. “Air conditioners are no more a luxury in our country and they are a necessity. Even the Indian Railways are taxed at the same rate, irrespective of the class of ticket bought. Reasonable tax rates lead to better compliance and increased revenue for the government,” they added. 

According to President of PRAHA, Ganesh Shetty, the memorandum was handed over to Javadekar on Saturday. “He has assured that he will take the issue up with the concerned authorities and we hope that the rates are revised as per our recommendations,” he said.

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