Ahmedabad: Over 3,000 restaurants in the city have decided to go on a strike on Monday. In protest against levying of 4.94% service tax on AC restaurants, more than one crore restaurants across India are likely to remain shut. Among them are 25,000 restaurants in Gujarat.
Hotel and Restaurant Association of India has no issue with levying of service tax. “We have no problem with tax as it will be passed on to consumer. Our problem is harassment by excise officers. Last year, , jewellers in the country went on almost one-month strike and succeeded in getting excise duty removed. Intervention of excise is a big hurdle, so we are protesting against 4.94% of service tax,” said Ashwin Gandhi, member of Gujarat Rajya Hotel Federation.
In Ahmedabad, many restaurants have announced a shutdown on Monday. “Havmor, TGB, Honest, Kanak, President, Fortune Landmark, Country Inn, Fern and others have decided to remain closed on Monday. We are all protesting against service tax levied on AC restaurants,” said Narendra Somani, promoter of Bhagwati Banquets.
After the announcement about the tax, many have removed air-conditioners, said Pradip Chona, director of Havmor Ice Cream Ltd. “Even Havmor is participating in the strike as all restaurants all over India are keeping close. The tax is also levied on takeaway food, MRP products such as cold drinks, bottled water and other items. It is an unjustified tax. Many restaurants on highways have small AC rooms that are usually closed; they have started removing ACs,” said Chona.
In an era of rising inflation, such policies or tax hike will make food more expensive, said Chona. “The food for middle class becomes expensive. Due to this move, the tourism and hotel industry will suffer,” he added.
Fortune Landmark will keep open the restaurants for guests residing in the hotel. “The restaurants will be open only for those who are residing in hotel and for those who have pre-booked the table. For others, the restaurants will be closed,” said an official of the hotel.