New Delhi: If you're a fan of a good drink in Maharashtra's bars and lounges, get ready to shell out more cash. The state government has just announced a 5 percent hike in Value Added Tax (VAT) for permit room liquor services, starting from November 1. This move will push the total VAT rate on such services to 10 percent.


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However, if you're planning to grab your favorite bottle from the local wine shop, you're in luck - the price there won't be affected by the VAT hike. (Also Read: Crafting Profits: Invest Rs 50,000 In This Business Idea And Earn Rs 3 Lakh Per Month - Check)


According to a recent Times of India report, the government issued a resolution on Friday detailing the VAT increase. Notably, this won't impact star hotels, as they already pay a higher VAT rate of 20 percent for their liquor services. (Also Read: Invest Once In THIS LIC Scheme, And Reap A Whopping Return Of Rs 93 Lakh)


Hoteliers have expressed concerns about the VAT increase, stating that recent hikes in license fees have already burdened them, leading to increased costs for customers.


The recent decision to increase the Value Added Tax (VAT) on liquor in Maharashtra has raised concerns among industry leaders, who fear that this move could drive up prices and deter customers from dining out.


Pradeep Shetty, president of hotels and restaurants of western India (HRAWI), highlighted that this hike, coupled with the annual increase in excise fees, might lead to a decline in business.


According to sources within the industry, this VAT increase could steer consumers toward more budget-friendly options, like consuming alcohol in off-premise locations such as terraces, parks, beaches, or even parked vehicles.


Moreover, media reports have suggested that the state government is contemplating a new excise policy. This policy might entail linking the pricing of alcoholic beverages to their alcohol content and allowing the sale of bottled liquors in bars and permit rooms.