Karnataka hotels cite high LPG and rent taxes for not passing GST cuts

Karnataka State Hotels Association says high GST on LPG cylinders and property rents prevent hoteliers from passing government GST cuts to consumers. The association urges relief on rent and fuel to make food and room tariffs more affordable

Bengaluru: The Karnataka State Hotels Association has expressed its inability to pass on the GST rate cut benefits to consumers as the taxes on LPG cylinders and property rents have not been reduced.

The Association has urged the government to provide relief by reducing the GST on property rent and helping hotels survive in the competitive market.

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This comes after the GST Council, comprising the Centre and states, decided to reduce tax rates on about 375 goods and services, from September 22 — the first day of Navaratri. In a statement, the association President G K Shetty welcomed the government’s decision to reduce the GST on several items, saying it would benefit the common public.

“People are asking when hotel food and room tariffs will be reduced,” he said, and explained that the hoteliers cannot lower the prices at this juncture unless they get some relief from the government.

Shetty pointed out that vegetables, meat, and some other items are under 0 per cent GST from the beginning, but the 18 per cent GST on cooking gas cylinders has remained untouched. “In addition, hoteliers who run their business from rented buildings are paying 18 per cent  GST on the rent they pay,” he said.

Noting that a majority of restaurants and Hotels are run from rented buildings, Shetty said, if the GST is reduced to 5 per cent on rent, then we can pass on the benefits to consumers. “With the present GST rate, it is not possible to offer any relief to consumers,” he said.