20,000 bars and restaurants across the state Unite Against 60% Excise Duty Surge, 10% VAT on IMFL, and 15% Licence Fee Increase
FinTech BizNews Service
Mumbai, July 12, 2025: The National Restaurant Association of India (NRAI) has expressed unequivocal support for the state-wide bandh declared by the hospitality industry in Maharashtra on Monday, July 14, 2025, in response to the recent and unprecedented increase in excise duties and licensing costs.
As part of the protest, over 20,000 bars and restaurants across the state have pledged to suspend alcohol service for the day, in a silent but impactful show of dissent against the 60% increase in excise duty, the increase in VAT on liquor from 5% to 10%, and the yearly 15% increase in licence renewal fees for FY26.
"The hospitality industry continues to recover from the severe setbacks caused by the pandemic. "This sudden and disproportionate triple tax hike feels like economic throttling," said Sagar Daryani, President, NRAI. "Such irrational policy decisions will not only overburden restaurants and bars, but will also have a knock-on effect on employment, consumer sentiment, and investor confidence in Maharashtra's food and beverage industry. We strongly urge the State Government to hold a constructive dialogue with industry stakeholders and reconsider these measures.
Daryani further emphasized that “The cumulative impact of the 60% excise duty hike, increase in VAT from 5% to 10%, and recurring 15% increase in license fees could be devastating for the sector—putting the livelihoods of over 20 lakh people directly and indirectly employed in the food service and hospitality industry across the State at risk.”
The association also cautioned of a possible increase in illegal liquor trade, a decline in tourism revenue, and a significant drop in legal sales, all of which could result in significant revenue losses for the state. It also noted that frequent policy changes disrupt business planning, creating uncertainty.
"Mumbai and Pune are not only Maharashtra's largest hospitality hubs, but also among India's most vibrant culinary and nightlife destinations," said Pranav M Rungta, NRAI Vice President. "Imposing such steep and arbitrary tax increases will harm legitimate businesses, reduce employment, and drive consumers to unregulated alternatives. We do not oppose taxation; we oppose irrationality. The government must collaborate with the industry to create a more balanced, business-friendly environment that promotes economic growth and job stability."
The NRAI, whole heartedly supports other industry bodies and regional hospitality associations, extending its call for a constructive dialogue with the State Government in order to create a more rational and growth-oriented taxation structure.
