Bar and restaurant owners demand withdrawal of privilege fee

Wanaparthy: Bar and restaurant-owners across the district observed a shutdown on Friday, demanding a reduction of additional taxes and fee in response to a call given by Damodar Goud, president, Telangana Bar Association. During the protest, they addressed the media here, expressing dissatisfaction with government policies.

They demanded withdrawal of the newly introduced ‘privilege fee’ and urged the government not to further increase the already high licence fee. If the government fails to respond, they would consider an indefinite shutdown and potentially even surrender the licences.

They stated imposition of a ‘privilege tax’, ranging from 8-16% on top of licence fee, calculated based on the rent of the bar, has made running the businesses extremely difficult. The additional privilege tax is structured as follows: 8% for rents between Rs 30 lakh and Rs 39 lakh; 10% for Rs 39 lakh to Rs 44 lakh; 12% for Rs 44 lakh to Rs 50 lakh; 14% for Rs 50 lakh to Rs 58 lakh; and 16% for rents exceeding Rs 58 lakh.

The owners expressed concern that the decision increased the cost of procuring liquor and made operational expenses burdensome. Previously, regarding the limits on stock allocation, they stated that while a profit margin of approximately 14% could be earned on MRP, the figure drops to 6–7% once certain limits are exceeded. They are facing financial hardships due to a combination of rising rents, labour wages and other operational costs, compounded by additional taxes.

They noted that some small eateries and restaurants located along roadsides are selling liquor alongside food; urged the government to take action to regulate these ‘belt shops’ If liquor prices in bars increase, consumers might turn to alternative, unauthorised sources. It has become difficult to cover rising operational costs while continuing to sell at MRP.

The owners stated that each establishment supports, directly or indirectly, between 20 and 35 families, and in some cases, up to 40 families. If bars were to close, the livelihoods of workers’ families would be severely affected. Had the government consulted them before finalising the tax policy, they would have had the opportunity to explain the challenges.

They demanded a reduction in the additional burden; requested that, in the event the licences had to be surrendered, the rental fee already paid should be refunded. Sabbi Reddy Venkatreddy, Niranjan Goud, Venugopal Goud, Rahul, Suresh Goud and Bandaru Gangadhar attended the press meet.

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Akar Vijay

Akar Vijay