New Delhi, Feb 3 (PTI) – The National Restaurant Association of India (NRAI) on Monday welcomed the government's move to reduce income tax in the Union Budget 2025-26, anticipating a surge in discretionary spending that could benefit the restaurant industry. However, the association expressed disappointment over the continued exclusion of the sector from being granted industry status.
NRAI President Sagar Daryani highlighted that restaurant footfalls had been on a decline over the past year but expected a turnaround as the middle class gains more disposable income due to the revised tax slabs. “With more money in people's hands, the new tax breaks will encourage dining out, which will positively impact restaurants and malls," Daryani said in a statement. He added that increased footfall would boost business profitability and create more employment opportunities.
Despite this optimism, NRAI Vice President Pranav Rungta reiterated the sector’s long-standing demand for industry status, emphasizing that its contribution to employment and economic activity remains overlooked. “The restaurant industry is the second-largest employer in the services sector, directly providing jobs to nearly 9 million people. Recognizing it as a labour-intensive industry would have significantly bolstered job creation and economic recovery, particularly post-pandemic," Rungta stated.
Additionally, Daryani raised concerns about the Goods and Services Tax (GST) structure, pointing out that the GST Council has yet to respond to the industry's demand for input tax credit. “This remains the single most significant obstacle to our sector's growth,” he stressed.
The NRAI urged Finance Minister Nirmala Sitharaman and the Centre to address the sector’s challenges and implement necessary policy measures to ensure long-term sustainability. The association continues to push for recognition and policy support to strengthen the industry’s growth trajectory.
Last updated by a enewsx:
