Hosting parties at five-star hotels gets costlier; excise dept bars outside liquor
Hosting social gatherings at four and five-star hotels will pinch the pocket a lot more. The excise department has made it mandatory for the guests to buy the liquor from the same establishment in which the function is being organised.delhi Updated: Jul 07, 2012 02:16 IST
Hosting social gatherings at four and five-star hotels will pinch the pocket a lot more. The excise department has made it mandatory for the guests to buy the liquor from the same establishment in which the function is being organised.
Earlier, the guests were allowed to buy the liquor from outside for wedding functions or other parties. But now, with the excise department's new notification coming into effect the patrons will have to buy expensive and highly taxed drinks from the hotel itself.
Five-star hotel associations claim that the move will increase the cost of hosting social gatherings there by at least 30% and will adversely impact business.
Hotels levy a number of taxes such as service charge, value added tax and service tax on the liquor sold by them.
According to officials, those found violating the new order will be fined between Rs 10,000 to Rs 50,000.
"We had received a number of complaints that people were getting alcohol from defence canteens, where it is sold at a subsidised rate, to avoid paying tax and this was affecting revenues. The notification has been issued and hotels have been asked to strictly adhere to the new guidelines," said a senior Delhi government official.
"This will increase the cost by at least 30 per cent and will affect business severely. Licensed liquor is served in five-star hotels even when people get it from outside so why bring in this new rule. Service tax has already increased twice and the new notification will only make it more expensive for the people," said OP Mendiratta, general secretary of Unit Hotel Forum.
According to the officials, for any function held in four or five-star hotels people used to buy alcohol in bulk which used to be served by the hotel staff.
"Hotel staff used to check whether people have the receipts for alcohol that has been bought from ouside or not. Those who can afford to host a party at a five-star hotel can also spend on alcohol too. This new notification will not affect them," added the official.