Federation of hotel The End Restaurant Association of India (FHRAI) advocated the separation of the Goods and Services Tax (GST) on food and beverage services at the hotel on Sunday. Citing several representatives given to the officials, FHRAI emphasized that the current trend of connecting food and beverage (F&B) taxation to the fare of the hotel room is unfair. It is also challenging for operations for the hospitality industry. Under the current GST framework, hotels which charge Rs 7,500 or more per day, they will have to pay 18% GST on F&B services with input tax credit (ITC) benefits, while hotels with less than this limit will have to pay 5% GST without ITC. This step will save a big savings for those staying in the hotel.
Hotels get options
FHRAI has proposed a flexible system, under which all hotel restaurants can freely opt for five percent GST without GST or ITC with ITC, no matter what room fare. FHRAI vice -president Pradeep Shetty said, “As soon as a hotel gives a room of more than Rs 7500, the GST rate for the restaurant of the same hotel increases to five percent to 18 percent. So we have requested to separate it. ”
Simply to simplify ‘GST 2.0’
The Congress said on Sunday that the next phase of Goods and Services Tax (GST 2.0) should be made completely simple and less punitive. Significantly, Finance Minister Nirmala Sitharaman said on Saturday that GST rates will be reduced further. Congress general secretary and communication in -charge Jairam Ramesh said that his party had envisaged a good and simple tax through GST 2.0 in its manifesto of 2024 Lok Sabha elections. He said in a statement, “The ball is now in the court of the central government- will they take advantage of this historic occasion?” Ramesh said, “The Finance Minister has announced that the GST rates will be reduced soon. The Indian National Congress reiterates that any change in GST should be more wider than mere decrease in rate.
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