GST Hotels
Tariff Tier Rates

HOTEL ROOM GST RATES (by value of supply per unit per day), on the GST 2.0 structure effective 22 September 2025: (1) UP TO ₹7,500 per night: 5% GST WITHOUT input tax credit. This single rate replaced the old ₹1,000-exempt / ₹1,001-7,500 at 12% split — the 12% slab no longer exists. (2) ABOVE ₹7,500 per night: 18% GST with ITC.

KEY: based on the value of supply actually charged per unit per day. (3) RESTAURANT inside the hotel: separate rate — see the next question. (4) RESORTS + LUXURY above ₹7,500: 18%. EXAMPLE: ₹10K/night room × 3 nights = ₹30K. (a) GST 18% × ₹30K = ₹5.4K. (b) Total ₹35.4K.

SECOND EXAMPLE: ₹6,000/night × 3 = ₹18K, GST 5% = ₹900, total ₹18,900 — under the old 12% rate the same stay carried ₹2,160 of GST, so the change is worth ₹1,260. STRATEGIC: ₹7,500 is still the optimisation point, but the gap is now 5% vs 18%, not 12% vs 18%.

Source: Ministry of Finance / GST Council, FAQs on the 56th GST Council, Q71.

RESTAURANT IN HOTEL: (1) STANDALONE BUDGET hotel restaurant: 5% no ITC. (2) PREMIUM hotel restaurant (room tariff > ₹7,500): 18% with ITC. (3) PREMIUM hotel restaurant (room tariff < ₹7,500): 5% no ITC. (4) ROOM SERVICE included: same as restaurant rate. (5) MINIBAR: 18%. (6) BREAKFAST INCLUDED with room: room tariff rate. STRATEGIC: business travelers + corporates use ITC-eligible options for tax efficiency.

INDIVIDUAL travelers absorb GST cost.

HOTEL EVENTS GST: (1) BANQUET HALL HIRE: 18% with ITC. (2) WEDDING PACKAGE in hotel: typically 18%. (3) CONFERENCE + MEETING ROOM: 18%. (4) AUDIO VISUAL EQUIPMENT rental: 18%. (5) CATERING within banquet: 18%. (6) BUNDLED packages (room + food + venue): typically 18% on full package. EXAMPLE: ₹5L wedding package at hotel. (a) 18% × ₹5L = ₹90K GST. (b) Total ₹5.9L.

STRATEGIC: factor 18% GST in event budgets. CORPORATE EVENTS: claim ITC if registered.

OTA + TRAVEL AGGREGATORS: (1) MakeMyTrip, Booking.com, Goibibo, Yatra, EaseMyTrip: collect GST at the room rate (5% or 18%). (2) Platform commission separate — taxable to platform. (3) COUPONS + discounts apply BEFORE GST. (4) FOREIGN OTA platforms: same rates apply to Indian hotel bookings. (5) DOMESTIC travel — typically inclusive. (6) FOREIGN travel from India: Section 206C TCS 5% applies for spend > ₹7L (separate from hotel GST). STRATEGIC: compare across OTA platforms for best price after GST + commission.

HOTEL GST STRATEGY: (1) BUDGET TRAVELERS: target ≤ ₹7,500/night for 5% (no ITC) vs 18% (with ITC). (2) BUSINESS TRAVELERS: claim ITC if employer GST-registered. (3) CORPORATE BOOKINGS: invoice in company name with GST + ITC. (4) RESORTS + LUXURY: factor 18%. (5) WEDDING + EVENT: 18% on full package. (6) FOREIGN TOUR via Indian travel agent: TCS 5% above ₹7L spend (separate from GST). (7) MEMBERSHIP PROGRAMS (Marriott, IHG): may have GST benefits. (8) AIRBNB India: same hotel-like GST treatment for property owners > threshold. (9) TIME SHARE: separate rules. CONSULT CA for corporate travel + hospitality businesses.