The central government on the recommendation of the council presented in the 37th GST council meeting held on 20/9/2019 had made changes in the GST tariff for hotel & restaurant sector seeking the growth in the hospitality industry of the country. These changes would be implemented by way of issuance of notification under official gazette w.e.f. 1st October 2019-
- Changes in the GST tariff levied on outward supply of following services vide Notification No. 20/2019-CT (Rate) dated 30/9/2019 amending the original notification no. 11/2017-CT (Rate): –
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S.no.
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Particular
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Rate
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Condition
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1
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Hotel accommodation service whose value of supply is Rs. 1001 to 7500 for each unit per day
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12%
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–
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2
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Hotel accommodation service whose value of supply is above Rs. 7500 for each unit per day (named as ‘specified premises’)
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18%
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–
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3
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Supply of restaurant service other than those located in a premise having accommodation unit whose declared tariff above Rs. 7500 per unit per day
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5%
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Provided that no ITC used in supplying service has not been taken
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4
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Supply of restaurant service in a premise having accommodation unit whose declared tariff above Rs. 7500 per unit per day
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18%
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–
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5
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Supply of food or any drink of human consumption by Indian railway or IRCTC or their licensees, whether in train or platform.
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5%
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Provided that no ITC used in supplying service has not been taken
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6
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Outdoor catering service provided at specified premises by any of the following persons: –
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18%
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–
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7
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Supply of outdoor catering service at any premises other than specified premises by any person other than those located in specified premises or providing accommodation of at specified premises
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5%
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Provided that no ITC used in supplying service has not been taken
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8
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Outdoor catering service along with renting of premises making it a composite supply, provided by any of the following person: –
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18%
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–
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9
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Supply of outdoor catering service along with renting of premises making it a composite supply, at any premises other than specified premises by any person other than those located in specified premises or providing accommodation of at specified premises
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5%
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Provided that no ITC used in supplying service has not been taken
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The comparative study on the industry in terms of the reduction of the GST rate can be understood as: –
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S.no.
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Particulars
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Before 01/10/2019
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On or After 01/10/2019
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1.
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Value of supply of hotel accommodation for a unit per day: –
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||
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Up to Rs. 1000
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0%
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0%
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Rs. 1001 to 5000
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12%
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12%
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Rs. 5001 to 7500
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18%
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12%
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|
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Rs. 7501 & above
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28%
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18%
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2.
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Restaurant service: –
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||
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5%
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5%
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18%
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18%
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5%
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5%
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3.
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Service by way of Outdoor catering
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18%
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5% or 18% (subject to specified conditions)
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4.
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Composite supply of outdoor catering along with renting of premises
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18%
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5% or 18% (subject to specified conditions)
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- Changes in taxability of Liquor License: –
The central government on being recommendation by the 26th GST council meeting & in exercise of the power given u/s 7(2) of CGST ACT, 2017 notified that the service provided by the state government by way of granting the liquor licence against consideration in the form of licence fee or application fee shall be treated neither as a supply of goods nor a supply of service (Notification No. 25/2019-CT(Rate).
Therefore, any register person obtains liquor licence from the state government is not liable to levy GST, as it outside the ambit of the term ‘Supply’ as defined u/s 7 of CGST Act, 2017.
