The Indian Hotel and Restaurant Association is observing a nationwide bandh today, with most hotels and restaurants across the city deciding to down shutters to oppose a new tax.
The move is sure to affect residents of the city, especially office-goers and college students. Nearly 8,500 restaurants across the city are expected to participate in the bandh. They are opposing the Union government’s decision to levy an additional service tax along with VAT on restaurants that are fully or partially air-conditioned.
“From April 1, all fully or partly air-conditioned restaurants will have to charge an additional 12.63 per cent on 40 per cent of their total bill as ‘Service Tax’. This is in addition to the 12.5 per cent VAT. This service tax will also be applicable to customers having food in the non-AC section,” said Arvind Shetty, president of AHAR.
More than 135 mid-range restaurants in the city have already shut down in the past two years, failing to keep up with the heavy taxation. The association has demanded immediate withdrawal of the tax, failing which they will continue their agitation.