Australia's HVAC&R industry may complain about the carbon tax but in India a tax on air conditioning was introduced on April 1, 2013.
President of the Federation of Hotels and Restaurant Association of India Arvind Shetty said the 12 per cent service tax applies to businesses that are fully or partly air conditioned.
"How is air-conditioning a luxury in this city where the daytime temperature in summer is 35 degrees Celsius and humidity levels can reach 100 per cent?" Shetty said.
As part of its campaign seeking withdrawal of the service tax, more than 8,000 bars and restaurants will close their doors on April 29, 2013.
Businesses fear they will lose clients if the cost of the tax is passed on to customers.
"We are seeking clarification over whether the tax will be applicable to air conditioned restaurants with an area over 2,000 sq feet or for all such restaurants," Shetty said.
KPMG India partner Pratik Jain said the tax applies to any business that provides a service such as air conditioning.
"Service tax can only be levied if there's an element of service involved which would typically be the case when one goes to a high-end restaurant," he said.
