Service charge advisory to affect hotel business in AP

Businesses fear discretion could lead to skipping payment.
A file photograph of youngsters dining
Rajahmundry: As the Centre has issued an advisory recently stating that paying service charge at the hotels and restaurants is discretionary and a majority section of customers is unwilling to pay such charge, the hotels and restaurants will be having their revenue dented in city.
Though service charge is being levied ranging from 5 per cent to 20 per cent in addition to the service tax and value added tax, hotels and restaurants in the city are collecting service charge ranging from 2.5 per cent to 5 per cent, while a few hotels are not at all charging service charge on customers for room service and also at restaurants.
Each customer is supposed to pay service tax to the tune of 5 per cent, valued added tax worth 14.5 per cent and the service charge ranging from 2.5 per cent to 5 per cent and above, once he or she avails of a service at a hotel. For instance, a person orders for a chicken biryani at a star hotel, he or she has to pay Rs 250, two taxes and service charge additionally.
The hoteliers say a majority number of customers intend to avoid paying service charge if it is made discretionary by saying that they are not satisfied with the kind of service provided at the hotel even if the service is good, as they want to reduce their total bill amount to be paid.
Rajamahendri Hotels and Lodges Association executive committee member A. Suresh said, “Collecting service charge at the discretion of customer will certainly affect the revenue in the hotels as no customer will be interested to pay it claiming that the service at the hotel is not satisfactory even if he or she feels satisfied to reduce the bill amount given huge amount of tax, including service tax and VAT, is being imposed. Moreover, such move makes the managements to provide the best service to the customers at least to collect service charge and avoid revenue loss.”
A three-star hotel banquet manager Ch. Chakradhar said, “Each customer pays nearly 25.5 per cent taxes on total amount of the bill, which is burdensome to him or her. As we collect service charge of only 5per cent, there is no much resistance from the customers at present. We all are eagerly waiting for uniform tax system of GST as it will provide relief from tax burden.”
Bird Centre to get Tourist amenities
Forest authorities are developing amenities for the benefit of tourists at Madhavapuram Bird Centre located at Kolleru sanctuary in West Godavari.
Forest authorities say nearly 100 varieties of birds will visit the bird centre during the winter season and this result in a large number of tourists visiting the area to spot the birds. The forest authorities are developing amenities worth about `10 lakh at the bird centre to avoid any trouble to the tourists to reach the place and stay there for some time.
The authorities are also taking up habitat improvement works at the bird centre by setting up stands for the birds to perch, brood and breed during the season.
Display boards are to be set up at the bird centre giving information about the popular birds visiting it. The information will be of immense utility to the students interested in birds as the name of the species, their scientific name, life span, original habitat and other details will be put on display.
Eluru divisional forest officer (wildlife) N. Nageswara Rao said, “As part of development of Madhavapuram Bird Centre, we are providing a series of amenities to the tourists as it is popular after Atapaka at Kolleru sanctuary as more number of tourists are visiting to watch the birds and enjoy the nature.”
The forest authorities said desilting of Mondikodu drain would be taken up as it will help water flow into the lake and help the tourists visiting bird centre enjoy boat ride. At present, as the drain is filled up with silt, no water is entering into the lake located in that part.
The West Godavari administration has directed the water resources authorities to take up desiltation of as many as 50 drains, which carry water into Kolleru lake. As these drains are filled up with silt, parts of lake are not having adequate water.