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.