{"id":851,"date":"2026-08-06T23:46:04","date_gmt":"2026-08-06T18:16:04","guid":{"rendered":"https:\/\/www.taxaj.com/learn\/gst-applicability-tax-rates-on-tourism-and-hospitality\/"},"modified":"2026-08-14T11:09:49","modified_gmt":"2026-08-14T05:39:49","slug":"gst-applicability-tax-rates-on-tourism-and-hospitality","status":"publish","type":"post","link":"https:\/\/www.taxaj.com/learn\/gst-applicability-tax-rates-on-tourism-and-hospitality\/","title":{"rendered":"GST on Tourism & Hospitality \u2014 Hotels, Restaurants & Tour Operators"},"content":{"rendered":"

The tourism and hospitality<\/strong> sector \u2014 hotels, restaurants, tour operators and travel agents \u2014 has some of the most nuanced GST rules, with rates tied to room tariffs<\/strong> and special schemes for restaurants and tour operators. This guide explains how GST applies. (Rates are revised periodically \u2014 confirm the current position before invoicing.)<\/p>\n

Hotels & accommodation<\/h2>\n

GST on hotel accommodation is linked to the declared room tariff \/ value of supply<\/strong>. Lower-tariff rooms attract a lower GST rate and higher-tariff rooms a higher rate, with the applicable slabs revised from time to time. Hotels charging GST on rooms can generally claim input tax credit<\/strong> on eligible inputs.<\/p>\n

Restaurants<\/h2>\n

Standalone restaurants are commonly taxed at 5% without input tax credit<\/strong>. Restaurants located in hotels where the room tariff crosses a specified threshold<\/strong> are taxed at 18% with ITC<\/strong>. Getting the classification right affects both your rate and your ability to claim ITC.<\/p>\n

Tour operators & travel agents<\/h2>\n

Tour operator services (packaged tours) are often taxed at a concessional rate (commonly 5% without ITC<\/strong>) on the package value, while a travel agent’s commission\/service is taxed at the standard rate. Air-ticket booking commissions and forex\/visa services have their own treatment. Because these differ by exact service, confirm the current rule.<\/p>\n

Compliance essentials<\/h2>\n
    \n
  • Correct classification of accommodation vs restaurant vs tour operator<\/strong> services and the right rate.<\/li>\n
  • Track ITC eligibility (many restaurant\/tour supplies are without ITC).<\/li>\n
  • GST on OTA\/aggregator<\/strong> bookings and any reverse-charge situations.<\/li>\n<\/ul>\n

    Frequently asked questions<\/h2>\n

    How is GST charged on hotel rooms?<\/h3>\n

    By room tariff \/ value of supply<\/strong> \u2014 lower tariffs attract a lower rate and higher tariffs a higher rate, with slabs revised periodically.<\/p>\n

    What GST rate do restaurants charge?<\/h3>\n

    Standalone restaurants are commonly 5% without ITC<\/strong>; restaurants in higher-tariff hotels are 18% with ITC<\/strong>.<\/p>\n

    How are tour operators taxed under GST?<\/h3>\n

    Packaged tours are often at a concessional rate (commonly 5% without ITC); a travel agent’s commission is taxed at the standard rate.<\/p>\n

    \n

    In hotels, restaurants or travel?<\/strong> TAXAJ handles GST classification, ITC and returns for the hospitality sector. Get GST support from TAXAJ \u2192<\/strong><\/a><\/p>\n

    Related guides:<\/em> GST registration<\/a> \u00b7 GST returns<\/a> \u00b7 Input tax credit<\/a><\/p>\n