Pune Hospitality Sector Faces Crisis As Tax Hikes Threaten Survival, Say Hoteliers
Pune, July 12, 2025: The hospitality industry in Pune and across Maharashtra is staring at an unprecedented crisis as steep tax hikes imposed by the state government threaten to cripple restaurants, bars, and hotels. The Pune Restaurants and Hoteliers Association (PRAHA) has raised alarm over the situation, warning of mass closures and job losses if immediate relief is not provided.
In a strongly worded statement, PRAHA President Ganesh Shetty said, “The triple burden of increased taxes has pushed businesses to the brink. Operational costs have skyrocketed, and survival is becoming nearly impossible for thousands of establishments.”
The hospitality sector has been hit by:
- Doubling of VAT on liquor from 5% to 10%
- 15% hike in annual license renewal fees for FY 2025-26
- 60% increase in excise duty
Pune alone has over 4,200 licensed hospitality establishments employing nearly 6 lakh people directly and indirectly, including vendors, transporters, farmers, and artisans. The industry warns that the tax hikes will lead to shutdowns, layoffs, and a significant drop in tourist inflow, dealing a severe blow to the city’s economy.
PRAHA leaders pointed out that such aggressive taxation contradicts efforts to promote Pune and Maharashtra as global tourism hubs. “Instead of attracting visitors and investments, these measures will push business and tourists to more affordable states,” said Vice President Jawahar Chorge.
The association has urged the Maharashtra government to immediately roll back the tax hikes, engage in consultations with stakeholders, and create a sustainable roadmap to protect employment and tourism.
“The hospitality sector is the backbone of Maharashtra’s economy and culture. Neglecting it now will have devastating long-term consequences,” Shetty warned.
