New GST effect on hotels and foods
With the new GST rates coming into effect on September 22nd, not only oil and soap but also hotel accommodations and meals will become cheaper. Starting tomorrow, only 5% GST will be levied on hotel stays up to ₹7,500.
With the implementation of new GST rates, hotel rooms costing ₹7,500 or less will become cheaper by ₹525 from Monday. The hotel sector believes that the reduction of Goods and Services Tax (GST) rates from 12% to 5% for the hotel industry, coupled with the absence of input tax credit (ITC), is expected to boost the industry. Companies say this will increase revenue, encourage investment, and enable hotels to provide better services to guests across the country.
Currently, hotel rooms with a daily rate of up to ₹7,500 are subject to a 12% GST plus ITC. According to the Hotel Association of India, this reduction will reduce room rates by 7%. Similarly, travelers will also benefit from GST on food.
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People will get relief
Nikhil Sharma, Managing Director and Chief Operating Officer (COO) of Radisson Hotel Group, South Asia, said that the reduced GST will provide relief to hotel operators and will also benefit travelers. Rahul Makarios, Managing Director of the Eurasia market for Wyndham Hotels & Resorts, which owns brands like Ramada, said that India’s travel and hospitality sector is growing strongly and the GST reform has come at the right time.
The new rate will be applicable from September 22
Earlier this month, the GST Council approved major changes to the indirect tax system. Rates have been revised, reducing the slabs to just 5 percent and 18 percent. These changes will come into effect from September 22, the first day of Navratri.
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