May27
2019Introduction of GST has benefited the hospitality industry due to standardized and uniform tax rates, and easy and better utilization of input tax credit. GST abolishes several taxes, leading to a reduction in procedural steps and easy availment and utilization of input tax credit. Under the GST regime there will be only a single charge on the bill and it would give the customers a clear picture of the tax they are paying.
However, under GST as well there are multiple tax rates that may be applicable on the accommodation depending on the tariff being charged by the hotel per room per night. Moreover, GST rates applicable to the restaurants which are part of a hotel are likely to be different from other independent restaurants providing dining or take away services.
GST Rates for Accommodation Facility:
Refer to the table below to understand GST Rates:
Actual Tariff per Room per Night | GST Rate |
Less than Rs.1,000 | 0% |
Rs.1,000 – Rs.2,499 | 12% |
Rs.2,500 – Rs.7,499 | 18% |
Rs.7,500 and above | 28% |
Declared Tariff v/s Actual Tariff (Realized Rent):
GST Rates for Eateries and Take Away Restaurants inside a Hotel:
GST Rate for Eateries and Take Away Restaurants outside a Hotel:
GST rate is 5% (without ITC) for restaurants, eateries, mess, canteen, etc. whether for dine in or take away facility from the premises where such premises is NOT located inside hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging.
Refer to below table:
Type of Restaurant | GST Rate |
Restaurants within Hotels (declared room tariff <7,500) | 5% (without ITC) |
Restaurants within Hotels (declared room tariff >7,500 ) | 18% (with ITC) |
All Restaurants | 5% (without ITC) |
Outdoor Catering | 18% (with ITC) |
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