WEF 18th Jul 2022 a GST rate of 12% will be levied on hotels having a tariff below Rs1000 per night. Prior to this there was no GST applicable for room tariffs below Rs1000 per night.
More than 60% (Around 2170 out of a total of 3848 hotels approx) of hotels in Goa, registered with the department of Tourism are small hotels with a tariff below Rs1000 per night.This will affect them adversely and increase their compliance costs.
In addition to the above GST levied on restaurants in hotels is linked to the room tariff. Restaurants in hotels with a room tariff below 7500 have a GST of 5% without Input Tax Credit (ITC) and those with a tariff above 7500 have a GST of 18% levied with ITC.
The Travel and Tourism Association of Goa(TTAG) would request Shri Mauvin Godinho, The Hon Minister of Industries and Transport and Goa’s Representative on the GST council to take up this matter and propose the below mentioned solutions:
A) Revert to exempting tariffs below Rs 1000/- from having a GST levied on them.
B) DE –Link GST on restaurants in Hotels from Room tariffs. Hotels should have the option of choosing a GST rate of 5% on restaurant services without ITC or 18% with ITC irrespective of room tariff.