FHRAI Highlights Concerns Over Agoda’s Commission Structure and Its Adherence to GST Regulations

The Federation of Hotel and Restaurant Associations of India (FHRAI) has complained about modifications introduced by Agoda, the world’s leading online travel platform, that are adversely impacting Indian hotel partners.

FHRAI claims that Agoda has changed its commission structure, now charging commission on the full room rate, including GST, rather than just the room price before tax, as agreed earlier. This new approach is putting extra financial strain on hotel owners, many of whom are still recovering from the pandemic.

The association also criticised Agoda for not following India’s GST rules. They allege that Agoda is charging commission on the GST portion of the room rate, which is against the law, and is not applying GST on its own commission invoices, which could unfairly shift the tax burden onto Indian hotels.

Apart from the commission issues, FHRAI reported other complaints from hotel members. These include unauthorised discounts being applied by Agoda, payment delays that require hotels to pay extra to release funds early, and a lack of clear communication from Agoda’s team. Hotels have also mentioned instances where Agoda amended their pricing strategies without notice or redirected bookings to competing platforms.

The FHRAI President noted that equitable partnerships are the way forward for India’s hospitality industry to recover and that such actions contradict the rules of equitable business and breach legal contracts. The federation has called on Agoda to roll back the modifications, respect the original contracts, and adhere to Indian taxation rules to preserve trust and transparency in the industry.