100% hike in luxury tax,raised VAT and lack of govt approval may force closure of 4,000 marriage palaces
For those waiting for the big fat Punjabi weddings in the peak season starting November,it may not be a very spirited time ahead with a closure threat hanging over the 4,000-odd marriage palaces that host the nuptials in the state.
The Punjab government has issued notices to all marriage palaces and halls,directing that they will be shut in case a hefty fee is not paid for getting approvals from the government,including permission for the change of land use (CLU). What may prove to be a double whammy is the fact that the government has also doubled the luxury tax for holding such functions and the permit fee for serving liquor. Besides,all these will lead to an increase in the VAT.
Due to this,many who have booked such palaces are in two minds they are planning either to erect shamianas in the open or to book regular hotels,which have also jacked up rates and are in short supply.
Speaking to The Indian Express,the acting president of Punjab Marriage Palace and Resort Association,Amarjit Singh Sant,said: Various state authorities have issued notices to us after a Punjab and Haryana High Court order. So far,except for the Patiala district,where 82 marriage palaces have been sealed,the others are open. But the sword of uncertainly is hanging over all of us.
Each marriage palaces caters to 80 to 90 functions on an average during a wedding season,he added.
The increase in luxury tax from four per cent to eight per cent has also resulted in higher costs for the weddings. Four years ago,this tax was proposed at 10 per cent. But after protest it was slashed to 4 per cent. Now,it has been doubled without taking our feedback. Also,liquor permit fees has been increased from Rs 5,000 to anything between Rs 12,500 and Rs 16,000, Singh said.
Moreover,the government will now charge VAT at 13.78 per cent and service tax at 13.75 per cent from marriage palace owners. Thus,we will end up paying 35.53 per cent as tax. We also pay Re 1 per sq ft during construction as institution tax, said Singh.
Meanwhile,while accusing the government with burdening the palaces only to bring itself out of the financial crisis,the owners have decided to move Punjab and Haryana High Court.
We do not take anything from government,but in turn,have to pay so many taxes, said Singh.