Union Budget 2021 India: Be it restaurants or banquet halls, the pandemic hit hard and no immediate relief measures were in sight for stakeholders till restrictions were eased.
Indian Union Budget 2021-22: Had it not been for the pandemic, the country’s travel and hospitality sector would have experienced a stellar year in 2020. Undoubtedly, the travel and hospitality industry were among the worst hit once the pandemic struck. Be it restaurants or banquet halls, the pandemic hit hard and no immediate relief measures were in sight for stakeholders till restrictions were eased.
Still, the challenges remain.
Budget 2021 expectations: No late fees and interest on VAT & GST
According to Shivanand Shetty, President of AHAR, Indian Hotel and Restaurant Association, “Our expectations from the Union Budget is there should be no late fees and interest on VAT & GST payment/returns filing up to 31st march 2021. As there was no business during the period, we requested a waiver of interest on existing loan/CC (working capital)/OD balance as on 20th March 2020 for a year.”
While some measures have been rolled out, these are not enough and a lot more is required to be done, observes Vineet Verma, MRICS, Executive Director & CEO, Brigade Hospitality. In his view, the following measures are essential:
1. Waiver or a reduction of interest on loans spanning lockdown period.
2.ECLGS, though welcome, should have working capital loans with reduced rates of interest.
3. GST rates for hotels and restaurants need drastic reduction for 2021-22.
4. MV Act notification on ‘One Nation, One Permit’, to be expedited to help boost inter-state movement of tourist vehicles.
5. State govts need to refund at least a part of the license fees and duties for the lockdown period, including property taxes, liquor licenses,etc.
6. Accord industry status to the hospitality sector.
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“There seems to be light at the end of the tunnel as the demand is slowly and steadily increasing, ” feels Bhanu Chopora, Founder & Chairman, RateGain, “It will give the sector the much needed push if the government includes the same in the concurrent list. Budgetary provisions, better regulations and policy decisions can go a long way for biz of all sizes and shapes. The government should consider granting infrastructure status to the segment. So this will allow businesses to avail water, electricity and land at industrial rates along with improved lending rates.”
Budget 2021 expectations from wedding industry
Weddings are typically big and grand celebrations in a country like India. However, most weddings were low key events even though an uptick in demand is a welcome trend for the hospitality segment. However, the wedding segment largely remains an informal and somewhat unorganised industry, thereby posing several concerns for its stakeholders who were hard hit during the pandemic.
Sandeep Lodha, CEO, OYO’s Weddingz.in told Financial Express Online, “The wedding industry, although known to be recession-proof, has also faced the brunt of the pandemic like all other businesses. With the cultural significance that weddings hold in India, while the industry is gradually pacing towards its recovery, it is imperative for the government to give impetus and rebound to the sector through consideration in Union Budget 2021.”
Suggesting the following measures, Lodha pitches for two relief-oriented steps for the wedding industry such as follows:
1. Financial relief for banquets that have paid GST for FY 19-20, provide them with 25% of the GST amount or credit. This will definitely help small and medium hotel owners sustain operations.
2. A growing need for the formalisation of the wedding industry sector.
“The wedding industry is an unorganised sector and formalising it will provide a level playing field for players across the board, ” Sandeep Lodha told Financial Express Online, ” We are hopeful that the Union Budget will lover the GST for banquets and other ancillary wedding services from 18% to 5% [and 2% in the short term] to bring about resurgence to both consumers and businesses.”