Under the GST Regime

Under the Goods and Service Tax, the hospitality sector stands to reap the benefits of
standardized and uniform tax rates, and easy and better utilization of input tax credit. As
the final cost to end user decreases, we can expect the industry to attract more overseas
tourists than before. This would ideally result in improved revenues for the government,
and there are many pros to this new tax regime which could help the industry’s growth in
the long run. For instance, complementary food (like breakfast) was taxed separately
under VAT, but now it will be taxed under GST as a bundled service. Let’s have a look at
the rates for this industry in detail:

GST Rates for Hotels based on Room Tariff (with effect from 01.10.2019)

Tariff per Night GST Rate

< INR 1,000 No Tax

INR 1,001 -7,500 12%

= or > INR 7,501 18%

GST Rates applicable for Hotel Industry

GST Rates for Hotels based on Room Tariff (Up to 30.09.2019)

Tariff per Night GST Rate

< INR 1,000 No Tax

INR 1,000 -2,499.99 12%

INR 2,500 -7,499.99 18%

= or > INR 7,500 28%

GST Rates applicable for Hotel Industry