HRAWI welcomes 5% GST for all restaurants

Hotel and Restaurant Association of Western India (HRAWI) has welcomed the recent reduction of GST rate to five per cent for all restaurants. The industry body has said this is a big boost for the industry which has been reeling under a slowdown for quite sometime. Now irrespective of whether the restaurant is air conditioned or not, the consumer will have to pay a uniform GST rate of five per cent.

“However, denying the ITC benefit on the grounds that we have not been passing on benefits is unfair. As of now, none of our vendors have reduced prices and there has not been any reduction of prices in raw materials for us. In fact, post introduction of GST the costs of operations and raw materials have actually gone up. The move to remove ITC amounts to double taxation and is inflationary,” said Dilip Datwani, president, HRAWI.

He added, “It also goes against every tenet of ease of doing business. We wish that the GST Council had considered that rent and interest attract 18 per cent GST. However, overall we welcome the developments. We understand that something as revolutionary as GST will bring some disruptions in the initial stages. We just hope that going forward, Input Tax Credit will be restored.”