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Thursday , 27 June 2019
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GST services tax rates finalized: education, healthcare exempted; 28% for five-star hotels

The GST (Goods and Services Tax) Council today finalized the GST tax rates for various services. One of the key decisions taken is that education and healthcare services will not be taxed under GST. For other services, the applicable tax rates will be 5, 12, 18 and 28 percent. Transport services including rail, air and road transport will be taxed at 5 percent whereas telecom and financial services will attract a standard tax rate of 18 percent. Speaking about the finalization of GST rates for service, Finance Minister Arun Jaitley said, “India has finalized four tax rates that will apply to services including telecoms, insurance, hotels and restaurants under a new sales tax which should be rolled out on July 1.” Overall, it is expected that the GST rates will make many things cheaper for the common man.

Five-star rooms and restaurants to attract maximum tax rate of 28%

GST rates have also been finalized for various types of hotels and restaurants. In case of non-air-conditioned restaurants, the tax rate will be 12 percent. For air-conditioned restaurants, the tax rate will be 18 percent. In case of hotels, those with tariff under Rs 1,000 would be exempt from GST regime and those with tariff of Rs 2,500 to Rs 5,000, the tax rate will be 18 percent. The maximum tax rate would be in case of hotels that have tariff of more than Rs 5,000. These are usually five-star hotels that would attract a tax rate of 28%.

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