Big Boost to Hospitality Sector as Govt Slashes Tax Rate on Hotel Room Tariffs

Union Minister Nirmala Sitharaman said that there will be no GST on room tariffs below Rs 1,000 per night.

Published: September 20, 2019 9:17 PM IST

By India.com Business Desk | Edited by Manmath Nayak

Big Boost to Hospitality Sector as Govt Slashes Tax Rate on Hotel Room Tariffs

New Delhi: Union Minister Nirmala Sitharaman on Friday made a major announcement aimed at giving a big relief to the hotel industry. The GST (goods and services tax) rate on hotel rooms with tariffs of up to Rs 7,500 per night has been reduced to 12% from the existing 18%, whereas the tax on room tariff of above Rs 7,500 has been slashed to 18% from the existing 28%. The minister said that there will be no GST on room tariffs of below Rs 1,000 per night.

While addressing the media after holding the 37th GST Council meeting in Goa, Sitharaman said that the GST rate on slide fasteners has been reduced from 18% to 12%, while on marine fuel it has been reduced from 18% to 5%. GST has been reduced from 12% to 5% on wet grinders consisting of stone as a grinder.

Sitharaman said that the GST on caffeinated beverages has been increased from 18 to 28 per cent with 12 per cent additional cess which takes the total tax rate to 40 percent.

The GST cess on 10-13 seater passenger vehicles has been reduced to 1 – 3 per cent for petrol and diesel vehicles, whereas railway wagons, coaches, rolling stocks were taxed at 12 per cent instead of earlier 5 per cent. Moreover, defence goods which are not being manufactured indigenously have been exempted from GST/IGST.

The minister said the uniform rate of 12 per cent will be applicable for woven and non-woven polyethylene bags. Supply of silver, platinum from specified agencies has been exempted from the GST, she said.

Earlier in the day, Sitharaman brought cheers to the domestic market with the reduction of corporate tax. The minister’s announcements come at a time when the country’s annual economic growth has fallen to a 25-quarter low of 5% in April-June period.

Also Read:

For breaking news and live news updates, like us on Facebook or follow us on Twitter and Instagram. Read more on Latest Business News on India.com.

By clicking “Accept All Cookies”, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts Cookies Policy.