Bengaluru: The Karnataka State Hotels Association (KSHA) has urged the government to reduce GST on commercial LPG cylinders from 18 per cent to 5 per cent, citing a steep and sustained rise in fuel prices that is severely impacting the hospitality sector.
The appeal comes amid a sharp increase of ₹993 per 19-kg commercial LPG cylinder announced on Friday, marking the third consecutive monthly hike.
LPG prices spike up to 70% in two months
According to KSHA, commercial LPG prices have surged by ₹1,308 over the past 60 days, making it one of the steepest increases in recent years.
Prices that were in the range of ₹1,800–₹2,000 in March have now crossed ₹3,100 in several cities, representing a rise of nearly 50 to 70 per cent depending on location.
Industry representatives attributed the spike to rising global energy prices, particularly due to ongoing geopolitical tensions in West Asia, which have disrupted supply chains.
Industry warns of price rise for consumers
KSHA President G K Shetty said that if immediate corrective steps are not taken, hotels and restaurants may be forced to pass on the increased costs to customers.
He warned that higher menu prices could reduce demand and make dining out less affordable for the public.
“The cumulative hike has placed an enormous burden on businesses. Without intervention, price revisions will be unavoidable,” he said.
Hospitality sector under pressure
The association highlighted that the hospitality industry, which is still recovering from earlier economic disruptions, is now facing renewed financial stress due to rising input costs.
In addition to LPG price hikes, hoteliers are also dealing with increasing local levies such as garbage collection charges in Bengaluru, along with other regulatory expenses.
These combined pressures have already led to the closure of several small and medium establishments, while many others are struggling to sustain operations.
Call for immediate policy intervention
KSHA has emphasised that reducing GST on commercial LPG would provide immediate relief, help stabilise operational costs, and prevent a cascading effect on food prices.
The association has appealed to both state and central governments to take urgent action, stressing the sector’s importance to employment and economic activity.
Conclusion
With LPG prices witnessing a sharp and sustained rise, Karnataka’s hospitality sector is at a critical juncture. Industry bodies have called for swift government intervention to ease the burden and prevent further closures, warning that inaction could lead to higher costs for consumers and long-term damage to the sector.