Some hotel and restaurant owners said they will protest against the GST (Representational)
Students are suddenly finding eating out a bit more expensive after the country switched to the Goods and Services Tax or GST. GST is charged at 18 per cent in air-conditioned restaurants; earlier the tax was at 6 per cent, restaurant owners say.
"Everywhere we have been to, there has been only price increase. Now they charge 18 per cent along with the existing prices. Even they are not clear why they are charging that," says college student Habin Hamza, who came for lunch with some friends.
Zam Zam chain in Thiruvananthapuram, known for its grills, says reducing prices is impossible. Their main raw material like chicken - though tax-free under GST - has seen no decline in prices.
While the restaurant charged only 6 per cent service tax earlier, it is charging 18 per cent now since it is an air-conditioned restaurant. As a result, the restaurant says business has slowed down.
"Our business has decreased substantially. People still get angry at us for charging GST; some even ask for the specific government order," says Abdul Shukoor, manager at Zam Zam.
"For AC takeaways we increased the tax from 6 per cent to 12 per cent. But now we are being told that it has to be 18 per cent. That's a huge change and there is confusion," says Mr Shukoor.
Madhusudhan Nair, who runs a restaurant where air-conditioning is not installed, said he has not started charging 12 per cent GST, adding he has time till August.
Before GST came, he said he paid 0.5 per cent tax to the state government. "An association of hotel and restaurant owners will protest outside parliament in August first week. We are demanding that the tax be reduced," he said.