Mumbai: The Hotel and Restaurant Association of Western India (HRAWI) today welcomed the revised goods and services tax (GST) slab on hotel room tariffs that widens the slab of 18 per cent to tariffs ranging between Rs 2,500 and Rs 7,500.
With the revision, the highest tax rate of 28 per cent is assigned to tariffs of Rs 7,500 and above, HRAWI said in a release issued here.
Along with the revision in the slabs for room tariffs, the tax rate for air-conditioned restaurants, including restaurants in five-star hotels will have GST at 18 per cent, effective from July 1, 2017.
"This is unarguably a welcome revision. But, if India has to remain competitive as a tourist destination, this may just not cut the ice.
"While neighbouring countries pay 5-12 per cent GST or equivalent tax, hotels in India would be levying 18 and 28 per cent GST.
This may not augur well with foreign inbound tourists who are lured with significant deals and sops by our neighbours," HRAWI President Dilip Datwani said.