Hotels & Restaurants need to be declared and treated as an industry: Gurbaxish Singh Kohli

India has an estimated more than 70,000 hotels and over 5 lakhs restaurants. India has an estimated 1,000 regional and hyper local cuisines reflecting the diversity of India’s geography, history and culture. Federation of Hotels and Restaurants Industry of India (FHRAI) aims to establish India as the concept hospitality and cuisine capital of the world. Speaking at the India Tourism Vision Day’ conference, Gurbaxish Singh Kohli, Vice President of FHRAI, expressed that they need an enabling environment from state governments and the central government to move towards its vision.

Kohli asserted, “Foremost, hotels & restaurants across each state of India need to be declared and treated as an industry. Unlike commercial establishments we do not just retail, we create and produce high-quality service. Power and water utility rates must be at industrial rates effectively.”

In order to make hotels and restaurants truly cost-effective and stimulate demand, he informed that GST rates for hospitality in India are one of the highest in the world which makes both domestic and inbound tourism in India expensive. He said, “The 18 per cent GST category for hotels above room rates of Rupees 7,500 must be abolished and merged with the category of 12 per cent GST. Gradually it should be brought down further below 10 per cent with full set offs in line with global trends.”

“Restaurants too have an 18 per cent and also 5 per cent slab but which is without setoffs. The 18 per cent category needs to be abolished and there needs to be an option made available of GST at 12 per cent with full set offs. Additionally, the needs to be no linkage to room tariffs above rupees 7500 as it currently exists,” he added.

Kohli further advised that a single e-clearance window at a national level must be enabled for hotels and restaurants through hospitality Development Promotion Board and all existing licenses, permits, permissions must be thoroughly examined for redundancies and standardised at a national level to bring down the cost of pre openings and also annual costs of compliance and make the industry more globally competitive.