Mumbai: The Central Board of Direct Taxes has released a clarification over the Goods and Services Tax rate for hotel rooms in a 5-star and a non-5-star hotel. CBEC has said there will be an 18 per cent GST rate for all hotel rooms that charge Rs 7,500 tariff irrespective of their star-ratings.
CBEC said in a tweet, "Clarification on the Goods and Services Tax rates on hotel accommodation tariff less than Rs 7,500 to attract GST at 18 per cent even in 5-star hotels."
Earlier, there were reports in some section of media that the government would charge hotel rooms at 28 per cent of GST rate irrespective of tariff slapped for accommodation.
"Star rating of hotels is, therefore, irrelevant for determining the applicable rate of GST," CBEC added. So based on the fresh circular from the direct taxes body, a room in any hotel that includes a 5-star one and that comes at Rs 7,500 tariff rate would attract only an 18 per cent GST rate....