Mumbai : In order to vitalize budget hotels economy in smaller cities and enhance tourism and job opportunities, the hotel industry has requested the Centre to dispense them worth Rs 10 crore infrastructure status which help reduce several costs particularly the taxes and thus foster smaller entrepreneurs to invest. Additionally, it has also requested Centre to impose GST on stay-hotels down to ten percent in lieu of 18% to make stays inexpensive for visitors and thus make the tourism advance.
Veteran emissaries of the Hotel and Restaurant Association of Western India summoned G. Kishan Reddy, who is the union minister for tourism, culture and development of Northeastern region and proffered certain requests in the interest of the hospitality sector and a common tourist.
Infrastructure status for smaller hotels projects :
The RBI has recognised hotels as a sub-sector of social infrastructure. The infrastructure status was sanctioned to hotel projects above Rs 200 crores. This threshold has to be diminished to Rs 10 crores per hotel to render fillip to the budget component in hotel industry. Due to this, the hospitality segment will contain a growth of inexpensive projects and will make a way for new opportunities including job creation, growth of tourism and price reduction in hospitality services.
As a matter of course, there will be hopes for affordable projects in tier 2 and tier 3 cities which will raise the local tourism and also create job opportunities for the local public. In parallel, demand in allied industries will uplift opening up opportunities in local skill and services.
Restaurants should be permitted to benefit the chance to either charge a composite GST at 5% with no input tax credit or charge GST at 12% with full input tax credit. This method will be beneficial for restaurants to maintain reasonable prices on the menu which will certainly make eating out less expensive for the automat.