Tag Archives: GST Council

GST Council recommends slashing GST for AC restaurants to 12% from 18%

The GST Council has recommended slash in GST rate for AC restaurants to 12 per cent from previous 18 per cent. This recommendation was made during the Council’s 22nd meeting held on October 6 in Delhi under chairmanship of the Union Minister of Finance and Corporate Affairs, Arun Jaitley. The federal tax body has set up a five-member panel of state ministers to make the quarterly tax filing and payment scheme for small businesses more attractive and to rework the tax rate on restaurants.

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GST of 28% now applicable on hotels charging Rs 7500+ tariff

The Goods and Service Tax (GST) Council has considered revision of tax on hotel rooms and decided that while those in the range of Rs 2,000-Rs 7,500 a day tariff would face 18 per cent tax, rooms with daily tariff above Rs 7,500 would be taxed at 28 per cent. This comes as a slight relief for the hospitality and travel industry, especially in comparison with the initial rate of 28 per cent being levied for hotels charging over Rs 5000 per night. However, Arun Jaitley, Union Finance Minister, has said that the GST on restaurant service in 5-star hotels would attract 18 per cent tax.

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Better than applying CENVAT credit: ADTOI

According to the GST Council, there will be 5 per cent GST on tours, said P.P. Khanna, President, ADTOI. However, he added that it is not clear whether this rate is applicable on value addition or gross amount. “In a way, the 5 per cent rate is good as we were already paying 4.5 per cent tax on the packages, and it is only 0.5 per cent more than that, which is tolerable. The service tax amendment of 9 per cent tax was more cumbersome for us, as applying for CENVAT credit was an issue, especially with small tour operators and small hotels not being systematic in generating proper invoices in our country. I think the government has taken special consideration for tour operators, as this process was difficult for us,” he shared.

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GST Council levies 5% rate on tours

The Government of India’s GST Council finalised the tax rates on services under the Goods and Services Tax (GST) regime at their meeting held in Srinagar, Jammu & Kashmir. The GST regime is scheduled to kick-in from July 1, and the council has approved the GST rates for services at Nil, 5%, 12%, 18% and 28%. According to the current rate, the 5% rate of GST will be levied on transport of passengers by rail (other than sleeper class); transport of passengers by air in economy class; transport of passengers with or without accompanied  belongings, by air, embarking from or terminating in a Regional Connectivity Scheme Airport;  as well as supply of tour operators’ services. There is 12 per cent GST rate levied on transport of passengers by air in other than economy class. These rates will be further subjected to vetting and would undergo some changes.

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