The Tamil Nadu State Hoteliers Association has declared a state-wide bandh on 30th May 2017, against the implementation of the GST. With over 1.5 lakh restaurants and bakeries in the state and 1500 bakeries, 400 restaurants and 300 small eateries in Coimbatore, the cash flow in the hotel sector will be largely affected. The Hoteliers Associations of Kerala and Pondicherry will be extending their support in the strike as well. The TN Trade Union is convening a meeting today, after which they will take a call on their support for the strike.
While addressing the press, B.Srinivasan, President of the Coimbatore District Hoteliers Association said, “GST implementation may be is essential to the growth of the nation, however, this will largely affect the consumers and stake holders in the hotel business. Those who earn below Rs.20 lakhs will be made to pay only minimal taxes, and those earning Rs. 20-50 lakhs will be made to pay 5% tax. Non-AC restaurants will have to pay 12%tax, 18% tax will be imposed on AC restaurants, catering services and wedding halls will also have to pay 18% tax.
At present, the VAT is at a 2% rate, with the implementation of the GST, there will be a drastic increase of over 10% in the VAT rate. Most restaurants are now turning air conditioned, with a higher rate of tax imposed on them, it will have a deteriorating effect on the cash flow.
A total revenue of 500-600 crores is being made through the hotel business of the state per day, while a revenue of 1-4 crores is earned in Coimbatore. Implementing a uniform tax structure might turn out to have a positive impact on the nation, but to the hotel sector it is sadly a bane.”
While addressing the press, B.Srinivasan, President of the Coimbatore District Hoteliers Association said, “GST implementation may be is essential to the growth of the nation, however, this will largely affect the consumers and stake holders in the hotel business. Those who earn below Rs.20 lakhs will be made to pay only minimal taxes, and those earning Rs. 20-50 lakhs will be made to pay 5% tax. Non-AC restaurants will have to pay 12%tax, 18% tax will be imposed on AC restaurants, catering services and wedding halls will also have to pay 18% tax.
At present, the VAT is at a 2% rate, with the implementation of the GST, there will be a drastic increase of over 10% in the VAT rate. Most restaurants are now turning air conditioned, with a higher rate of tax imposed on them, it will have a deteriorating effect on the cash flow.
A total revenue of 500-600 crores is being made through the hotel business of the state per day, while a revenue of 1-4 crores is earned in Coimbatore. Implementing a uniform tax structure might turn out to have a positive impact on the nation, but to the hotel sector it is sadly a bane.”