In India, the Goods and Services Tax (GST) has been implemented to simplify the tax structure and reduce complexities. For hotels, the GST rate is a crucial aspect to consider. The rate of GST for hotels is 18% for rooms with a tariff between ₹1,001 and ₹7,500 per night, and 28% for rooms with a tariff above ₹7,500 per night. The HSN code for hotel services is 9963.
The effective date of the GST rate for hotels is July 1, 2017. The brief description of goods/services is "accommodation in hotels, inns, guest houses, clubs, campsites, or other commercial places meant for residential or lodging purposes." There are special conditions or exemptions for hotels, such as a lower GST rate of 12% for rooms with a tariff up to ₹1,000 per night.
| HSN Code | Service Description | GST Rate (%) | Effective Date |
|---|---|---|---|
| 9963 | Accommodation in hotels, inns, guest houses, clubs, campsites, or other commercial places meant for residential or lodging purposes | 18% (₹1,001 - ₹7,500), 28% (above ₹7,500) | July 1, 2017 |
The tax breakdown for hotels in India is as follows: for rooms with a tariff between ₹1,001 and ₹7,500 per night, the GST rate is 18%. For rooms with a tariff above ₹7,500 per night, the GST rate is 28%. There is also a lower GST rate of 12% for rooms with a tariff up to ₹1,000 per night.
Let's consider an example: if the base price of a hotel room is ₹5,000 per night, the total GST amount would be ₹900 (18% of ₹5,000). The total amount payable by the customer would be ₹5,900 (₹5,000 + ₹900).
Our GST calculator widget can help you calculate the total GST amount for your hotel stay. Simply input the base price to see the total GST amount.
| Tariff Range (₹) | GST Rate (%) | Total GST Amount (₹) |
|---|---|---|
| Up to 1,000 | 12% | 120 (12% of 1,000) |
| 1,001 - 7,500 | 18% | 900 (18% of 5,000) |
| Above 7,500 | 28% | 2,100 (28% of 7,500) |
Before the implementation of GST, the tax structure for hotels was complex and varied across different states in India. The pre-GST tax regime included various taxes such as service tax, luxury tax, and value-added tax (VAT). The tax rates ranged from 10% to 20% depending on the state and type of hotel.
The GST regime has simplified the tax structure for hotels, with a uniform tax rate across the country. However, the GST rate for hotels is higher than the pre-GST tax rate in some states.
| State | Tax Rate (%) |
|---|---|
| Delhi | 10% |
| Mumbai | 12% |
| Bangalore | 15% |
Here are some frequently asked questions and compliance tips for hotels in India:
Compliance tips:
18%
28%
9963
July 1, 2017
Yes
