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GST Impact In Telangana On Hotels & Restaurants

About 90 per cent of 40,000 hotels and restaurants in Telangana today closed protesting the proposed increase in tax under the Goods and Services Tax (GST) regime and seeking to lower it to 5 per cent.

According to S Venkata Reddy, president of Telangana Hotels Association, the office bearers also met the State Finance Minister E Rajender who is also member of the GST council and apprised him of their demand. According to Reddy, the proposed tax would be 5 per cent on hotels with turnover up to Rs 50 lakh and for Non-AC hotels- 12 per cent, AC hotels – 18 per cent and star category hotels would attract 28 per cent.

“We demand the government to classify all the hotels and restaurants into two categories – star and non-star and impose 5 per cent on non-star hotels. Today we met our Finance Minister and gave representation,” Reddy stated.

He said 90 per cent of hotels in Telangana fall under 12 per cent and 18 per cent regime and that would adversely affect the industry which is said to be third largest sector in the country in terms of providing employment. He also said future course of action will depend on the outcome of GST Council meeting to be held on June3.

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