Holiday packages to get pricey

Brijesh Modi, Head-Finance & Commercial, SOTC Travel, says, “Due to the changes in the taxable services from 30 per cent to 60 per cent on holiday packages (bundled services), the effective service tax rate will see an increase from 4.5 per cent to nine per cent.” He adds that the tax on hotel accommodation services provided by travel agents is expected to increase from the current 1.5 per cent but agents are still seeking clarification on the same. “On transport services provided by travel agents, the current service tax rate will remain at six per cent. Above change in service tax will increase the selling prices of holiday packages,” Modi says.