-KH News Desk (editorial1@imaws.org)\
K.B. Kachru, President of the Hotel Association of India (HAI), the national body for Indian hotels, has urged policymakers to prioritize structural reforms that will ensure sustained growth and resilience for the hospitality sector ahead of the Union Budget 2026-2027. The sector is highlighted for its immense potential to create both direct and indirect jobs, contribute significantly to the GDP and foreign exchange earnings, and support the India vision 2047 of a Viksit Bharat (Developed India).
Key Demands and Strategic Significance
HAI’s comprehensive recommendations center on policies, tax rationalization, and streamlining business operations. The most critical demand is to officially accord hotels Infrastructure Status, which would grant the sector benefits such as lower power and utilities tariffs and rationalized property taxes, currently available to other industries. This is deemed vital for catalyzing growth and strengthening the sector’s resilience.
Under Direct Taxes, HAI calls for a higher rate of depreciation for hotel buildings to encourage reinvestment and modernization. For GST concerns, the association emphasizes an urgent review of the recent rate reduction for accommodations priced at ₹7,500 and below, which was implemented without the availability of Input Tax Credit (ITC), potentially disincentivizing fresh investment. Further GST reforms requested include delinking the GST rates on food and beverage services from the room rates. Finally, to enhance Ease of Doing Business, HAI demands the introduction of a single-window clearance system for licensing, a reduction in the number of approvals, and the removal of the requirement for multiple liquor licenses within a single hotel property.
Highlighting the need for the long-awaited Infrastructure Status, the article summarizes K.B. Kachru’s core message: “The key suggestion is to give the sector the due recognition that it deserves by according hotels the status of infrastructure and allow them the benefits that are currently available to Industry in terms of lower power and other utilities tariffs and rationalized property taxes.”
