Understanding GST Rates for Hotel Accommodation and Restaurant Services in India: A Comprehensive Guide

GST rates for services is prescribed through Notification No.11/2017-CTR dt 28.6.2017.

GST rates from 1.7.2017 to 30.9.2019.

Prior to 1.10.2019, GST rates were 12% if the Declared tariff per room accommodation was less than or equal to Rs 7500 per day and 18% if the Declared tariff per room accommodation was more than Rs 7500  per day. The rates remained the same even if the discounts were offered.

GST rates from 1.10.2019 onwards.

From 1.10.2019 onwards, GST rate for hotel accommodation service  depends on value of supply of  accommodation service and not on Declared tariff of room accommodation.

GST rate is 12% if the value of the room accommodation   is less than or equal to Rs 7500 per day.  The rate is 18% if the price charged for room in a hotel is more than Rs 7500 per day as per the amendments carried  through Notification No.20/2019-CTR dt 30.9.2019 amending the basic Notification No.11/2017-CTR.

As per the amendment carried through the said Notification 20/2019-CTR, restaurant service attracts 5% GST without Input tax credit if the Declared  tariff per room is less than or equal to Rs 7500 per day.

However, the GST rate is 18% with input tax credit facility on restaurant service if Declared tariff of room is more than Rs 7500 per day.  Restaurant service provider can take input tax credit on the goods and services used to provide restaurant service.

Important point to note is that Declared tariff is not relevant to determine GST rates of hotel accommodation, but Declared tariff rates are very much relevant to determine the GST rates in restaurant service located in a hotel.