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Hotel stocks surge after GST rate cuts

Capital Market 

Shares of hotel and hospitality companies advanced after reduction in the rate of Goods and Services Tax (GST) on hotel accommodation service.

Meanwhile, the S&P BSE Sensex was up by 774.64 points, or 2.04% to 38,789.26.

Lemon Tree Hotels (up 8.09%), Indian Hotels Company (up 7.79%), Taj GVK Hotels & Resorts (up 5.62%), Oriental Hotels (up 5.18%), Hotel Leela Venture (up 3.72%) and EIH (up 3.49%) advanced.

The GST Council on Friday, 20 September 2019, decided to lower GST rates on hotel tariff and outdoor catering, giving a boost to the hospitality sector. On the hotel tariffs front, daily room tariff beyond Rs 7,500 per day will attract GST at the rate of 18% as against existing 28%. Room tariff between Rs 1,000 and Rs 7,500 will continue to attract 12% GST. There will be no GST on room tariff up to Rs 1,000.

The GST Council has also decided to slash the rate on outdoor catering to 5% from 18%. However, no input tax credit (ITC) will be available to them.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, September 23 2019. 10:17 IST
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