HRANI Submits for 12% Hospitality Tax to GST Council:One Nation One Hospitality Tax

(L-R) Ms. Arti Kanwar, Special Commissioner (CTD) Gujarat; Smt Sungita Sharma, Principal Commissioner, Mumbai and Shri Raghwendra Kumar Singh, Commissioner (CTD) Madhya Pradesh

Delhi 12, June, 2017: The Hotel and Restaurant Association of Northern India (HRANI), has submitted for a One Nation One Hospitality Tax of 12% to the sectoral Working group of Travel & Tourism formed by The GST Council.

The first meeting of The sectoral working group of Travel & Tourism, formed to interact and examine industry representations and to make recommendation to the GST Council, was held on June 10, 2017 at Madhya Pradesh Bhawan, Chanakya Puri, New Delhi wherein the co-conveners Smt. Sungita Sharma, Principal Commissioner, Mumbai and Sh Raghwendra Kumar Singh, Commissioner, Commercial Tax, Madhya Pradesh interacted with the industry associations.

HRANI has appealed the working group for the following :

One Nation one hospitality tax @12%

To change GST slab to minimum Rs. 10,000/- as a slab of Rs. 5000/- does not constitute luxury.

A representation under the signatures of President, Mr. Sanjay Sood was submitted by HRANI. The working group was apprised on the tax incidence in current regime and the increased impact under the GST regime to be effective from July 1, 2017 through a table mentioned as under:-

Tariff RateRs. 5000 & aboveRs 5000 & above


Rs 5000 & aboveRs 5000 & aboveRs 5000 & aboveRs 5000 & aboveRs 5000 & aboveRs 5000 & above
Service Tax9%9%9%9%9%9%9%9%
Luxury Tax10%*10%10%5%8%15%10%10%
Total output tax incidence in current regime19%19%19%14%17%24%19%19%

Total Tax incidence in  GST

Impact under GST9.00%9.00%9.00%14.00%11.00%4.00%9.00%9.00%


Threshold of luxury tax in current regime Rs 3000/-

Tax incidence under GST (Rs 1000-Rs 5000) @ 12% to 18%

Total Impact on most of the Budget Hotels under GST goes up from 12% to the extent of 18%

The document also highlighted the impact of taxes on competitiveness of tourism, it was submitted that most of the nations recognize that tourism is a critical economic driver for the nation. European countries have fostered the growth of tourism by keeping low taxes on this sector as shown in the table given below:

 European Countries

Country NameTourism Tax Rate (%)

The meeting was attended by representatives of other industry associations like FAITH, FHRAI, HAI, IATO, TAAI, TAFI, ADTOI, ICPB, ITTA, IHHA and ATOAI including HRANI. Senior Officials from State and Central Government including MoT were present on the occasion. Presentations were made by the representatives of all trade bodies.

The sectoral working group gave a patient hearing and requested the trade bodies to send concerns at the earliest for a comprehensive note for GST Council.  The group also asked the industry to send their apprehensions relating to operational and administrative issues or any queries that may be affecting business upon transiting to the GST regime.

About Hotel and Restaurant Association of Northern India

Hotel and Restaurant Association of Northern India (HRANI) – a Northern outfit of the Federation of Hotel & Restaurant Associations of India is an apex body representing hotel & restaurant industry of the 9 North Indian States. The legendary Rai Bahadur M. S. Oberoi formed the association in 1950. Since its formation the Association has been effectively working for the cause of hospitality industry and plays a vital role in developing tourism in the nine member states that comes under its purview. These states are Delhi, Haryana, Punjab, Rajasthan, Chandigarh, Himachal Pradesh, Jammu & Kashmir, U.P. and Uttarakhand. As the voice of the North Indian hospitality industry, we represent 2,00,000+ Hotels & Restaurants in the region.  The Association is one of the most important & popular platform which highlights the Govt. Policies and Programmes. For further details please visit


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Food Critic and a Marketing Wizz who had a high profile career with leading MNC’s like HSBC, GE Capital etc, Pawan Soni comes across as a quintessential corporate employee. He left behind his successful career as the Vice President of a MNC... all for his love for food. He a WSET Level II wine connoisseur and a foodie who loves to eat anything under the sun. Besides being a food and travel writer for various food forums and magazines, he is the Founder and CEO of Indian Food Freak. As one of the initial bloggers who started his blog almost a decade ago, his website is currently one of the biggest food and travel blogs in the country. Pawan also conducts highly successful restaurant awards and recently concluded the 6th edition of The Big F restaurant awards. He won the best influencer awards in India by BBC Food Food Awards in 2018

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