Tag Archives: The Federation of Hotel & Restaurant Associations of India

The Federation of Hotel & Restaurant Associations of India (FHRAI), through a memorandum to the Government of India for the upcoming Budget 2018, has asked for ‘Infrastructure’ and ‘Industry’ status for the hospitality sector for projects of Rs 25 crore and more. FHRAI has also asked the government to keep uniformity in a flat tax rate at 12 per cent on all the categories, as a lower rate of 12 per cent will contribute to the nation’s GDP and encourage tourism-induced employment across the country. “The tourism sector suffers from a gap in terms of world-class infrastructure development in the country’s tourism destinations. This gap can be bridged by encouraging investments in hotel sector by giving infrastructure status for lower investments. Also, no other nation has a GST rate as high as 28 per cent on hotels and tourism. Charging different tax rates on the nature of accommodation and destination may escalate a perception that India is not a tourist-friendly nation,” says Garish Oberoi, President, FHRAI. Since there are restrictions in place for hotels to be constructed near the beaches and coastlines, FHRAI also recommends permission for construction of hotels, however, mandate may be given to hotels to ensure that the requisite environmental and safety norms are adequately taken care of. The memorandum also states that all foreign exchange earnings should be treated as exports or deemed exports. If the same would qualify as export or deemed export of services, the credit balance would be available for adjusting GST liability on domestic taxable supplies. Under GST also, government should provide the benefit as covered in SEIS. Declared tariff should not be basis for rate categorisation; rate categorisation should be on …

The Federation of Hotel & Restaurant Associations of India (FHRAI) has welcomed the GST Council’s decision to cut tax rate for restaurants to 5 per cent, without Input Tax Credit. A delegation from the industry led by Garish Oberoi, President, FHRAI, which also included Sudesh Poddar, President, HRAEI, and Pranav Singh, Hony. Secretary, HRAEI, had earlier met with the GST Council at Guwahati and requested the government to either bring down the GST rate on restaurants to 12 per cent with input credit or at 5 per cent without input credit. “We are extremely thankful to the government for making these much-required changes in the GST regime. This will help restaurants across India rationalise tariffs,” said Oberoi. The association had requested the committee to look at seven key issues for the hotel and restaurant industry, namely: IGST be made available for immovable properties for tourism accommodation such as for hotels, cruises, campsites, and for restaurants. Transaction value and not declared tariff be the basis for rate categorisation of hotels. GST on hotels be lowered to 12 per cent. Foreign exchange earnings in tourism services be treated as exports or deemed exports. Hotels and resorts be allowed to unbundle their package rates. GST not be charged on complimentary meals. Rationalisation of GST on restaurants at 12 per cent from 18 per cent, with input tax credit or 5 per cent, without input credit, be done.