Levy 5% GST on budget hotels, say stakeholders

PANAJI: Small-hotel owners called on chief minister Manohar Parrikar on Thursday urging him to ensure that a low tax rate of 5% was levied on budget hotels under Goods & Services Tax (GST) instead of the 18% that is likely to be levied on the service sector.

The hoteliers, backed by the Federation of Indian Chambers of Commerce and Industry (FICCI), said that a low tax rate would ensure that the tax burden was not passed on to the customer.According to industry stakeholders, budget category hotels, which charge a tariff of less than Rs 2,000 per room night comprise 80% of Goa’s hotel market.

“We want to be a part of one-nation-one-tax regime. We just don’t want it to happen at the cost of our business – there is no way the budget hotel industry will be able to sustain a high GST slab,” said Randhir Thakur, proprietor of Sodder’s Renton Manor.

The Union government has invited representations to hear concerns and feedback from the industry ahead of a critical discussion on GST during the third week of May.

Hoteliers stated that low tax rates will significantly increase foreign and domestic travel in India and that budget hotels are a source of gainful employment for thousands of people.

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