5% VAT on food: KHARA urges hoteliers to cooperate with CT dept

SRINAGAR:  As the new financial year has already started, Kashmir Hotels and Restaurant Association (KHARA) has urged all the hoteliers and restaurant owners to strictly implement the reduced 5 per cent Value Added Tax (VAT) on food. It also urged the hospitality sector to register their units with the department of commercial taxes and cooperate with the government.

“Government has accepted our demand of reducing VAT on food from 13.5 per cent to 5 per cent. It is now our responsibility to cooperate with the government and charge customers only 5 per cent of the VAT on food,” said KHARA President Showkat Chowdhary.

Chowdhary, who heads the largest and the oldest association of hospitality sector in the Valley, also urged the unit holders to cooperate with the commercial taxes department.

“We had assured the government that hospitality sector would cooperate with them. All the hoteliers, restaurant and other food joint owners should deposit the taxes with the commercial taxes department on time so that we can work together for the betterment of the tourism sector. This will also help state to improve state exchequer,” said KHARA President.

He also admitted that many unit holders have not registered with the commercial taxes department thereby skipping VAT.

“Every unit holder should register themselves with the department of commercial taxes so that we fulfill our commitment with the government. Government has acceded our demand of reducing VAT and now we should be ready to pay it. We had also assured the government that reduction of the VAT will only help state economy. We should show the government that we abide by our commitments,” said Chowdhary.

Notably, Valley hoteliers associations had met Finance Minister several times ahead of budged session with several demands. The Finance Minister’s proposal agreed to reduce the VAT from 13.5 per cent to 5 per cent in the State.

“We were paying highest VAT in the country earlier. It was our long pending demand and customers felt it burned to pay 13.5 per cent VAT on food. Now, competitive VAT rates will only help hospitality sector for which we are thankful to state government,” said KHARA. 

KHARA also urged consumers to only accepted bills with 5% VAT.

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