Government has issued notification on levy of GST on the tariff for various accommodation services including the Rooms rented in hospitals. Today, the levy of GST has been exempted by the government on the rooms rented to the patients in hospitals. CBEC has clarified the structure of GST on rented accommodations such as hotel, guest house, hospitals or inns.

Reportedly said, GST shall be payable on the actual amount charged to the customers and not on declared or published tariff. “Declared or published tariff is relevant only for the determination of the tax rate slab,” the clarification issued in form of Frequently Asked Questions (FAQs) said. For the purpose of determining the declared tariff, tariff declared anywhere, like on websites through which business is being procured or printed on tariff card or displayed at the reception, will be the declared tariff. 

A GST slab rate is provided for the levy of taxes on the rooms rented as below :

Value of Declared Tariff	Rate of GST
Below Rs.1,000	NIL
Rs. 1,000 to 2,500	12%
Rs. 2,500 to 7,500	18%
Rs. Above Rs.7,500	28%

 

Also clarified, the tax shall be levied on the entire amount charged to the customer, including any extra service provided such as extra bed.“GST rate would be determined according to the declared tariff for the room, and GST at the rate so determined will be levied on the entire amount charged from the customer,” it said. 

In case of room upgrades, the FAQ’s clarified that the tax applicable on the higher category rooms will be charged on the actual tariff paid. For Example, if the declare tariff of the accommodation provided by way of an upgrade is Rs.20,000 but amount charged is Rs. 14,000 then GST would be levied at the rate of 28 % on Rs 14,000. In case where different tariffs are declared at different sites for advertisement, then the higher of such tariff shall be the declared tariff for the purpose of levy of GST.

It is also been said that any service in the form of serving food or drinks including the bakery items, would attract 5% GST under composition levy scheme.

GST rate on services such as admission to entertainment events or access to amusement facilities, theme parks, water parks, joy rides, go-carting, casinos, race-course, ballet and any sporting event such as IPL would be 28 %. Entry to casinos as well as on the value of betting will attract 28 % GST.

Sources –The Economic Times

We have launched Single Platform on GST Compliances In India, assisting in 4 areas – 1) Migration, 2) GST Compliance, 3) Training and 4) Transition & Implementation. Click this link for any assistance

__________________________________________________________________________________________________________________________________________