Industry status

Hospitality Budget Expectations 2021: Grant Industry Status For Hospitality And Weddings, Here’s Why

Budget 2021 Expectations for the hospitality industry: GST rates for hotels and restaurants to be drastically reduced for 2021-2022.

Indian Union Budget 2021-22: Without the pandemic, the country’s travel and hospitality industry would have had a stellar year in 2020. Without a doubt, the travel and hospitality industry has been among most affected once the pandemic hits. Whether it was restaurants or banquet halls, the pandemic hit hard and no immediate relief measures were in sight for stakeholders until the restrictions were relaxed.

Yet the challenges remain.

2021 budget expectations: no late fees or interest on VAT and GST

According to Shivanand Shetty, President of AHAR, Indian Hotel and Restaurant Association, “Our expectation from the Union budget is that there should be no late fees or interest on payments. / VAT and GST returns until March 31, 2021. As there was no business during the period, we requested a waiver of interest on the loan / CC (working capital) / OD balance existing on March 20, 2020 for one year. “

Although some measures have been rolled out, they are not enough and much remains to be done, observes Vineet Verma, MRICS, executive director and CEO of Brigade Hospitality. According to him, the following measures are essential:

1. Waiver or reduction of interest on loans covering the lockdown period.

2. ECLGS, although welcome, should have working capital loans with reduced interest rates.

3. GST rates for hotels and restaurants are to be drastically reduced for 2021-2022.

4. Notification of MV Law on “One Nation, One License”, to be speeded up to help stimulate interstate circulation of tourist vehicles.

5. State governments must reimburse at least a portion of the license fees and duties for the foreclosure period, including property taxes, liquor permits, etc.

6. Grant industry status to the hotel sector.

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“There seems to be light at the end of the tunnel as demand is slowly and steadily increasing,” said Bhanu Chopora, founder and president of RateGain, “It will give the industry the necessary boost if the government includes the same in the list. Competitive budget arrangements, better regulations and policy decisions can go a long way for businesses of all sizes and shapes. The government should consider granting infrastructure status to the segment. access to water, electricity and land at industrial rates as well as improved loan rates. ”

Wedding Industry 2021 Budget Expectations

Weddings are usually big and big celebrations in a country like India. However, most weddings were low key events, although an increase in demand is a welcome trend for the hospitality segment. However, the marriage segment remains largely an informal and somewhat disorganized industry, posing several concerns for its stakeholders who have been hit hard during the pandemic.

Sandeep Lodha, CEO of OYO’s told Financial Express Online: “The wedding industry, although known to be recession-resistant, has also been hit hard by the pandemic like all other businesses. Considering the cultural significance of weddings in India as the industry progresses gradually towards its recovery, it is imperative that the government gives the sector a boost and rebound by considering it in the Union budget. 2021. “

By suggesting the following actions, Lodha offers two relief-focused steps for the wedding industry as follows:

1. Financial relief for banquets that paid GST for FY 19-20, provide them with 25% of the GST amount or credit. It will certainly help small and medium hotel owners to keep their business going.

2. A growing need to formalize the wedding industry sector.

“The wedding industry is an unorganized sector and its formalization will provide a level playing field for all players,” Sandeep Lodha told Financial Express Online, “We hope the Union budget likes the GST for banquets and other ancillary wedding services from 18% to 5% [and 2% in the short term] to spark a resurgence for both consumers and businesses.