The Hotel and Restaurant Association of Western India (HRAWI), the Indian Hotel and Restaurant Association (AHAR) and the National Restaurant Association of India (NRAI) have once again appealed to the Maharashtra Government to consider a rollback of the 15 percent hike in the excise license fee for the year 2020-21.
The associations have cited the latest notification issued by the Chhattisgarh State Government announcing a 25 percent reduction in the annual license fees for the year 2020-21 being provided as a relief on the account of disruption caused to businesses due to the nationwide lockdown. Other than Chhattisgarh, Goa, Madhya Pradesh and the Union Territories of Diu-Daman too have offered relief in the Excise License Fee in their States to reduce the burden on establishments during the lockdown, without any increase having been suggested earlier.
The three major F&B trade bodies had earlier written to the Maharashtra Government on April 15 appealing for a rollback on the Excise license fee increase. Among other recommendations, it also asked the State for a stimulus package for the distressed industry. However, the Associations haven’t received any response on the plea yet.
“The cash-strapped hospitality sector is already reeling under the pressure of ensuring the well-being of its employees during the shutdown and somehow preventing the immediate specter of massive job losses in the sector by deploying all its resources towards human needs. The hospitality and tourism sector accounts for 12.75 percent of employment, 5.56 percent of it is direct and 7.19 percent indirect. As we speak, the industry is staring at a potential job loss of around 38 million, which is 70 percent of the total workforce. Amidst this looming doom, an increase in fees is just too harsh a decision to even comprehend. While other states are making efforts to alleviate the pain and burden of its businesses, Maharashtra has decided to go in the other direction,” said Gurbaxish Singh Kohli, President, HRAWI.
With businesses closed, establishment owners are struggling to support their own families and those of their employees. Hospitality players have been voicing about expenses including property tax, electricity, maintenance, staff welfare, and water bills which continue to be levied in a zero-revenue environment.
“For our industry to survive and ensure the livelihood of the millions employed we need fiscal support from the State Government on multiple levels. A reduction of 15 percent for payment of the annual bar license fees only if paid by 30th April is equivalent to penalizing a business for non-timely payment of a fee. This comes at a time when there is zero cash flow and the industry is only adhering to the order issued by the Government to stay closed. We humbly request that this penalty clause be removed and instead offer us a reduction in the fee as other States have done,” said Shivanand Shetty, President, AHAR.
“It is common knowledge that the revival of the Hospitality sector may take more than 6 to 8 months at the minimum. Under these circumstances, an increase in fees will be impossible to bear, especially from the standpoint of business revival. In these times, it would be only fair and equitable for the fees to be rolled back and it is imperative that the same be charged pro-rata equal to the days that hotels or restaurants will be operational,” said Anurag Katriar, President, NRAI.
In the letter addressed to the Chief Minister of Maharashtra, Uddhav Thackeray, the HRAWI has appealed for as below:
1. Rollback of the 15 percent hike in the license fee and a give a reduction of the fees in these times of dire stress for the industry.
2. Pro-rata reduction in license fees charged owing to lockdown and consequent dry days as a measure of support to the Hotel and Restaurant Industry.
3. Withdrawal of the latest circular dated 13.04.2020 as well as of expectation from Hotels and Restaurants to pay any fees under the present situation whereby lockdown is extended.
4. Not to put conditions to the reliefs granted on deferment of the renewal date of staff payments or otherwise.