AHAR Urges Maharashtra Govt to Reverse Tax Hike

Quick Summary:

• Maharashtra’s hospitality industry faces financial strain due to recent policy changes, as highlighted by the Indian hotel and Restaurant Association (AHAR) on July 9, 2025.
• tax increases include:

– VAT on liquor raised from 5% to 10%.
– License fees hiked by 15% for FY26.
– Excise duty surged by 60%.

• AHAR warns these measures could lead to industry collapse, stating the sector is vital for employment and state tax revenues.
• The hospitality sector employs over four lakh individuals directly and indirectly supports around 18 lakh livelihoods via vendors and ancillary industries.
• Concerns raised about potential rise in tax evasion and illegal sale of liquor from neighboring states due to excessive taxation.
• AHAR urges the government to roll back these tax hikes or initiate dialogue with stakeholders.

Indian Opinion analysis:

The meaningful increase in taxes imposed on Maharashtra’s hospitality sector potentially threatens one of the state’s economically key industries that sustains millions through direct jobs, vendors, and associated sectors. Large-scale taxation policies without adequate industry consultation may lead not only to operational challenges but also encourage harmful practices such as tax evasion or illicit trade. Given its vast scale-overseeing thousands of establishments-the ripple effects might be extensively felt across employment levels, regional commerce dynamics, consumer affordability, and trust between businesses and governance.

AHAR’s assertions underscore an urgent need for balanced policymaking that tempers revenue needs with sustainable economic practices. The government’s openness in dialoguing with affected stakeholders could prevent long-term negative impacts while maintaining stability within this crucial ecosystem.

Read more: Published – July 10, 2025 [source link with no further edits]