GST Revamp on the Menu: Hotels Demand F&B Rate Independence

The Federation of Hotel & Restaurant Associations of India (FHRAI) is calling on the government to bifurcate GST on food and beverage services from hotel room tariffs. Hotels with room charges of more than Rs 7,500 are subjected to an 18% GST on F&B with the advantage of input tax credit, whereas those below this price bracket pay 5% without ITC. FHRAI suggests permitting hotels to opt for these rates separately, streamlining operations and providing more equitable taxation. This would prompt hotels to increase room tariffs and enhance government revenues, particularly in the luxury segment.

 

Source: Financial Express, Business Standard, Economic Times