Restaurants revise prices of food items despite GSTcut

BATHINDA: Though the Goods and Services Tax (GST) Council has slashed the tax rates on some items from 18 per cent to 5 per cent, many restaurants and eating joints have revised the price of food items listed on the menu to maintain their margin of profit.

Sukhmeet Bhasin

Tribune News Service

Bathinda, November 17

Though the Goods and Services Tax (GST) Council has slashed the tax rates on some items from 18 per cent to 5 per cent, many restaurants and eating joints have revised the price of food items listed on the menu to maintain their margin of profit.

Restaurants and eating joints have reduced the rate of tax but they have increased the price of many food items. With the move, customers are still paying the same amount which they were paying earlier.

On November 15, several restaurants and eating joints levied 28 per cent GST on food items. When the customers questioned and informed them of the new slab of 5 per cent, they refused to budge stating that they had not received any order or notification from the government yet.

A hotel owner, who did not wish to be quoted, said, “The increasing prices of food items on the menu is not a bad idea as the hotel industry is passing through a bad phase. The GST, from 28 per cent to 5 per cent, is not going to help the industry recover from the loss. Earlier, a ban on the sale of liquor in areas in the periphery of highways, GST and unavailability of premium liquor brands hit the industry hard this year.”

Satish Arora, state president of the Punjab Hotels and Restaurants Association, said “It is a rumour that is circulating as no hotelier has increased the prices. We have welcomed the move of the GST Council. We are hoping that the hotel industry will get a boost. Earlier, people used to shy away from visiting hotels and restaurants due to a number of taxes imposed on the food items. Now, they will surely start coming to the hotels.”

Arora said if dhabhas and other eating joints had hiked the prices of food items, it was not a right decision and they condemn it. He added that the customer should benefit from the government’s move.

He said a few days ago, a meeting of the hotel association was held in which it was decided that the prices would not be hiked and the customers should get the benefit. Making or changing a menu was a big process for the hotel industry and it could not be done in a day or so, he added.