Business Other News 27 May 2017 Telangana: Hotels to ...

Telangana: Hotels to strike for lower GST

DECCAN CHRONICLE. | DECCAN CHRONICLE
Published May 27, 2017, 12:28 am IST
Updated May 27, 2017, 12:28 am IST
At present, 5 per cent VAT is imposed on hotels with a turnover of below Rs 1.50 crore a month, 14.5 per cent for those with a turnover of above Rs 1.50 crore.
 At present, 5 per cent VAT is imposed on hotels with a turnover of below Rs 1.50 crore a month, 14.5 per cent for those with a turnover of above Rs 1.50 crore.

Hyderabad: Restaurants across the state have threatened to go on strike against imposition of higher tax rates of 12 per cent and 18 per cent under the new GST regime to be introduced in July.

The Telangana State Hotels Association is concerned that higher GST tax slabs will hit the industry and is demanding that the Central and state governments fix a uniform five per cent tax at the GST Council meeting on June 3.

The GST Council has prescribed the following rates: 5 per cent for businesses with turnover less than Rs 20 lakh per month; 12 per cent for turnover between Rs 20 lakh and Rs 50 lakh and non-AC restaurants and 18 per cent for AC restaurants.

At present, 5 per cent VAT is imposed on hotels with a turnover of below Rs 1.50 crore a month, 14.5 per cent for those with a turnover of above Rs 1.50 crore. All hotels collect 5.6 per cent service tax.

Hotel body opposes different tax rates
The Telangana State Hotels Association president S. Venkata Reddy said, majority of the hotels in the state will fall under the 12 per cent and 18 per cent tax category unlike at present where they fall under 5 per cent tax category.

The Telangana State Hotels’ Association on Friday held an emergency meeting to discuss the future course of action. It was decided to observe a ‘hotels bandh’ on May 30 across the state.

The state has nearly 40,000 hotels and restaurants. About 50 three-star, five-star and seven-star hotels are yet to decide whether to join in though the association claims that they will support the shut down.

Mr Venkata Reddy said, “We have submitted repeated representations to the Centre and state governments seeking a uniform tax rate of five per cent in the GST regime. But the GST Council fixed differential tax rates based on turnover. We strongly oppose this as it will adversely affect the hotel and hospitality industry.”

The association members on Friday met state finance minister Etela Rajender and requested him to take up the issue.

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Location: India, Telangana, Hyderabad




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