New tax proposals will badly affect bar hotels

By Our Staff Reporter

THIRUVANANTHAPURAM, JULY 18. The Kerala Bar Hotels Association has said that the new tax proposals in the budget will seriously affect the survival of bar hotels in the State.

The proposed hike in the sales tax on foreign liquor and food served in bar hotels and the hike in turnover tax and bar licence fee would create huge financial burden for bar hotels, the general secretary of the association, Mr. M.D. Jairaj, said at a press conference here on Wednesday.

He said that business had gone down drastically in bar hotels after the former Government introduced its liquor policy of handing over all foreign liquor shops to Government agencies. Toddy shops in the State had also been turned over to private individuals and illicit spirit was being made available in plenty to people, affecting the business of bar hotels, he said.

A tax hike on top of this would make it difficult for many to run their business. He claimed that the price of liquor being served in bar hotels would go up by 25 per cent once these tax proposals became effective.

This hike in the price of liquor available in bar hotels would drive many to seek it elsewhere and a possibility of another illicit liquor tragedy could not be ruled out, he claimed.

The association members said that according to unofficial estimates, country-made liquor and illicit foreign liquor worth Rs. 3 crores were being sold on a daily basis through various unlicenced outlets in the State. Thus the State had an annual sale of illicit liquor worth Rs. 1,100 crores.

Instead of taking stringent measures to check this, the Government could generate a huge amount as taxes, it had sought to impose tax proposals worth Rs. 85 crores on bar hotels, they pointed out.

This would also adversely affect the tourism industry, they said.

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Section  : Southern States
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