Hike in commercial LPG prices adding to burden: hoteliers

CHENNAI With food inflation remaining high, the recent hike in commercial liquefied petroleum gas (LPG) prices is the last straw on their backs, say hoteliers. This is the second increase in the past two months. 

In July this year, one 19 kg commercial cooking gas cylinder was priced at ₹1,809.50, in August it was ₹1,817; in October it was ₹1,903 and it again increased to ₹1,964.50 from November 1.

“This is just cross subsidy. The State-run oil marketing companies (OMCs) have subsidised domestic cylinders, so to manage the deficit they are hiking prices of commercial cylinders. This is also leading to an increase in food prices in restaurants. Both domestic and commercial LPG are the same. Only through quantity sold differs. To fix different prices is unjust,” explained a hotelier. 

M. Ravi, president, Chennai Hotels Association, said that the industry was already reeling under high inputs prices. “Have you lately noticed the price of cooking oils? Basic stuff like tomatoes, onions and even garlic have been going up. And on top of that the 18% GST on rented buildings is just too much. Why should hoteliers or other commercial establishments pay tax for the rent being paid to building owners,” he asks. 

R. Srinivasan, of the Tamil Nadu Hotels Association, said that the rule about 18% GST on rented buildings has been in vogue since 2017 and also from the old sales tax regime. The only change from last month is that instead of the building owner collecting it and remitting it, the person who runs the establishment should pay it. This will affect everyone from small restaurants to large hotels since our industry does not have inputs tax credit for this particular head.

Mr. Ravi also said that different GST slab rates for different products in the food industry were also creating a headache for hoteliers. “It is high time that we got uniform rates and that too lesser than the present. We are only collecting GST from our customers and remitting it to the government. Food is a basic need. There are people who depend on hotels throughout the month. Senior citizens and office-goers who are unable to cook prefer clean, hot food and they are being unnecessarily taxed,” he said. 

Hoteliers said that apart from LPG and vegetable prices, they were paying through their noses for manpower. “Since this is a service industry, manpower is needed in all areas of operation. The large and medium sized hotels use large a large number of men and if they are not paid well, they will easily quit and leave,” Mr. Srinivasan said. Hotel associations have supported the traders bodies who are opposing the imposition of 18% GST on rented properties and are demanding a roll back. 

Published - December 03, 2024 11:00 pm IST