GST and Its Impact on Indian Travel Industry

GST bill has been passed in Rajyasabha last night. Current Govt was trying to pass GST bill for some time after passing it in Loksabha some time back. At the moment Indian travel, tourism and hospitality industries have multiple taxes, levied by both the center and the states. It is believed now that after implementation of GST, supplies of hotels and restaurants will be subjected to a single tax. As it happens with every new start there is a confusion regarding the bill and its impact on several India industries. Let’s see what will be the impact of GST on travel, tourism and hospitality industry. As travel enthusiasts, should we ready to pay more for our travels or it will help us to save our cost?

GST IMPACT ON INDIAN TRAVEL INDUSTRY

At the moment we may assume there will be some impact of GST on hospitality industry, an important component of travel industry. This is expected to change under GST. R&D cess, payable on franchise fees and technical know-how, is likely to be subsumed under the bill, thus simplifying compliance procedures and reducing multiple taxes.

On the whole, the proposed tax structure is likely to eliminate multiplicity of taxes and lack of credits.

This proposed tax structure will offer some breathing space to a highly-taxed hotel industry. It is a good news for

travelers. Currently, the taxes are high and we end up paying a huge tax on hotels. The tax burden on tourists is going to be low for sure. Hotel price will be cheaper now for us.

At the moment in India hotels currently levy taxes in the range of 20% compared with just 2-5% on an average across the globe. It is really very high for travelers.

List of Countries Implementing VAT/GST

Currently, there are 160 countries in the world that have implement VAT/GST. Number of country based on region are as follows:-

We are wishing GST wont affect our travel budgets. We may hope that it will go easy on travellers.

Happy travelling. Be safe. Cya!!!