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Hotels, restaurants apex body welcomes GST rate change

Press Trust of India  |  New Delhi 

The Federation of Hotel and Restaurant Associations of (FHRAI) today said Council's decision to cut rate for restaurants to 5 per cent without input credit will help restaurants across rationalise tariffs.

Welcoming the move by the council, the apex industry body said it had sought bringing down rate on restaurants to 12 per cent with input credit or at 5 per cent without input tax credit.

"We are extremely thankful to the for making these much required changes in the regime. This will help restaurants across rationalise tariffs," FHRAI President Garish Oberoi said in a statement.

The today decided to fix the Goods and Services Tax (GST) rate at 5 per cent for all restaurants and not give them input tax credit. It also decided that restaurants in starred-hotels will charge 18 pc tax with input tax credit, those in lower category hotels to charge 5 pc GST without

Commenting on the development, Deloitte India said in a statement that a uniform tax rate of 12 per cent doing away with tax rate distinction between AC and non AC restaurants is welcome, but the critical issue of input tax credit eligibility cannot be ignored.

EY India said that the changes announced today is one more positive step in this direction towards streamlining the rates, reducing complexity and increasing compliance.

"We welcome the reduction in GST slab from very high 18 per cent to 5 per cent for an AC restaurant without any distiction on their conditioning. This is certainly historic. The very concept of Input Tax Credit (ITC) is central to GST which is to prevent cascading of taxes," NRAI Vice President Rahul Singh said.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, November 10 2017. 21:48 IST