Mumbai: Hoteliers in Mumbai, who passed on the new GST rates to consumers, have experienced an 80 per cent drop in home delivery orders.
According to a report in the Hindustan Times, some hotel owners have been passing on the increase in tax after GST to consumers, despite the state government warning them not to.
Under the new Goods and Services Tax regime, eating out in AC restaurants attracts 18 per cent tax, while eating out in non-AC hotels attracts 12 per cent tax. Customers have been placing fewer orders as they now have to pay the same tax, irrespective of where they eat the food.
When questioned about the state government advisory asking them not to pass on the increase in tax to customers, hoteliers said it was their only option, given the rise in input cost.
Kamlesh Barot, director, Vie Hospitality, which runs the Revival Group of Hotels, said, “From 15-20 orders a day, we are now down to 5. In most cases, customers cancel the order on delivery seeing the GST. The whole preparation is wasted when that happens.”
Hoteliers are urging the government to bring down the rate for delivery of food to 12 per cent.
