GST rate cut proves to be a mixed bag for travel, hospitality sector

Hotel rooms under ₹7,500 move to 5% slab, will bolster midscale segment

Bringing hotel rooms priced under Rs 7,500 a night into the 5 per cent slab (without input tax credit benefits) will further provide impetus to travel, helping the country’s tourism and hospitality sector, say industry executives.

 

The GST Council on Wednesday approved a two-slab structure, removing the 12 per cent and 28 per cent slabs. Hotel rooms priced over Rs 7,500 a night continue to remain in the 18 per cent slab, but below this level, the tax rate has been brought down to 5 per cent from 12 per cent.

 

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