FHW Staff – Mumbai
The Constitution (122nd Amendment) Bill for the rollout of the Goods and Sevices Tax (GST) that was passed by the Lok Sabha and the Rajya Sabha recently, has been welcomed by the Indian F&B and hospitality industry, which is hopeful of some tax relief and ease of business. The move, which aims to replace various taxes levied on goods and services through one indirect tax has garnered appreciation by the hospitality sector, which has been frequently advocating for reduction and simplification of taxations. Riyaaz Amlani, president, National Restaurant Association of India (NRAI), said, “The restaurant industry has been burdened with high and multiple taxations. We welcome the Centre’s move for introduction of this much awaited reform. We would need to look at the GST details as and when finalised. However, liquor should be included in GST; exempting it defeats the very purpose of bringing in a uniformed single tax structure. This allows states to have their own taxes without a cap with separate accounting requirements and results in double compliance for the restaurant industry. This is neither beneficial for ‘ease of doing business’ nor for the customers.”
Likely to be effective from April 1, 2017, GST is a single common tax on goods and services, right from manufacturing to consumption.
Ajay K Bakaya, executive director, Sarovar Hotels & Resorts said, “The much anticipated passage of the GST bill brings in a new era in fiscal reforms in India. Tax rates across various states will be uniform. The consumer will benefit from lower taxation, as there will be no tax on tax at different levels. Input credit on GST ushers in a whole new world of taxation.”
Whereas, the travel and tourism industry, which complements the hospitality industry, agreed that GST will bring a tax reform in the country. Vishal Suri, managing director, SOTC Travel said, “All countries which have adapted GST have grown in their GDP. Incase of travel and tourism, GST is likely to eliminate multiplicity of taxes. Implementation of GST will rationalise and simplify tax regime. It will lead to ease and transparency in compliances.”