Traveling Indians will have to shell out more when they stay in hotels. Eating out has also become more expensive with taxes now accounting for over 30% of the bill you settle at restaurants because of the hike in service tax from 10% to 12%.
It was in the last budget that hotel accommodationwith a daily tariff of over Rs 1,000 and air-conditioned restaurants serving liquor came under the service taxnet.
Taxes would account between 30 to 36% of the food bills after the proposed hike. The tax component includes a value-added tax of 12.5% to 14%, a service tax of 12% and service charge of 8% to 10%.
Though service charge, basically a tip, is not compulsory, several restaurants have incorporated it in the bill for the services rendered.
Room rates too will increase. A five star hotel stay will cost Rs 300 more on existing tariff of about Rs 15,000 per night.
The hotel industry has a luxury tax, which depending on the various states, ranges from 5% to 12.5%. As on 31 December 2011, there were 2,895 classified hotels having with an estimated inventory of 1.29 lakh rooms in the country.
Though service charge, basically a tip, is not compulsory, several restaurants have incorporated it in the bill for the services rendered.
Room rates too will increase. A five star hotel stay will cost Rs 300 more on existing tariff of about Rs 15,000 per night.
The hotel industry has a luxury tax, which depending on the various states, ranges from 5% to 12.5%. As on 31 December 2011, there were 2,895 classified hotels having with an estimated inventory of 1.29 lakh rooms in the country.