GST: Restaurants, hotels keep shutters down in South

Some makeshift food joints remained open in TN, Kerala, Andhra Pradesh, Telangana and Karnataka

Almost 500,000 eateries, including hotels, restaurants and bakeries, across the five southern states were shut on Monday following the one-day bandh declared by the Tamil Nadu Hotels and Restaurants Association and by the South Indian Hotels and Restaurants Association (SIHRA).

The shutdown was to protest the Centre’s move to levy tax of 12-28 per cent on the sector. Standalone restaurants and ordinary hotels in the south would be hit if rates are high. For instance, restaurants in Kerala and Puducherry do not have a service charge and just have to pay value added tax of around five per cent. But under GST, they would have to pay 12 per cent tax. In many North Indian states, the 12 per cent tax would be fine as some establishments already pay around 18 per cent tax.

M Venkada Subbu, president, Tamil Nadu Hotels and Restaurants Association, said: “The strike would see a loss of around Rs 500 crore.”  

Some makeshift food joints remained open in Tamil Nadu, Kerala, Andhra Pradesh, Telangana and Karnataka.

Bengaluru, India’s tech hub, has a thriving restaurant scene, catering to migrants from across the country. Around Rs 10 crore worth of business would be affected, said officials of the Bruhat Bangalore Hotels Association (BBHA).

The city has 3,000 registered hotels and restaurants, which had downed shutters in solidarity with the bandh call. However, the Karnataka Pradesh Hotels and Restaurants Association did not participate in the bandh.

"We wanted to show solidarity with the bandh call across south India," said Chandrashekara Hebbar, President of BBHA. "The government has proposed a levy of 5-18 per cent tax on different categories of restaurants. We have asked for relief."