GST tweak to hit restaurants’ expansion plans
NEW DELHI: The withdrawal of input credit under the goods and services tax for restaurants will adversely affect their expansion plans this financial year, chains across formats said.
In the absence of input credit for expenses such as rent and other capital costs that attract GST of 18% to 28%, opening a new outlet has become substantially more expensive, said Speciality Restaurants, the operator of brands such as Mainland China and Oh! Calcutta. It typically costs Rs 2.5 crore to Rs 3 crore to set up a new restaurant.