GST 2.0: Air Travel To Get More Affordable With Reduced Tax Rates; Here’s How Much You Can Save?

GST Rate Cut:  Starting September 22, travellers can expect reduced expenses on flight bookings as the 56th Goods and Services Tax (GST) Council meeting has approved significant changes to the tax rates on air travel. Chaired by Union Finance Minister Nirmala Sitharaman, the council on Wednesday brought down tax rates on air travel. This move comes ahead of the festive and wedding season, aiming to ease costs when spending on travel peaks.

In addition to this, hotel booking will also become cheaper as the council has made significant changes in Goods and Services Tax (GST) on hotel stays.

GST Reform: Air Travel To Become Cheaper

Air travel is set to become affordable with reduced GST rates across ticket classes. Economy class tickets will now be taxed at 5 per cent, down from the previous 12 per cent, while business class will attract a 12 per cent GST, reduced from 18 per cent. The revised tax rates are aimed at making air travel affordable for a wide range of travellers and easing costs for business travellers.

ALSO READ: GST Reform: Are You Planning To Visit Tourist Spots In India? Now, Your Tour Going To Be Affordable As Hotel Rooms To Get Cheaper

Economy Class Tickets:

- New GST Rate: 5 per cent

- Previous GST Rate: 12 per cent

Business Class Tickets:

- New GST Rate: 12 per cent

- Previous GST Rate: 18 per cent

ALSO READ: Shampoo, Toothpaste, Hair Oil And Other Personal Care Products Get Cheaper As GST Council Cuts Tax To 5%

GST Reform To Boost Tourism

The revised GST rates are expected to boost growth in the services sector, especially tourism, which was heavily impacted by the Covid-19 pandemic. Lower tax rates on flight tickets aims to make air travel appealing and affordable. With the festive and wedding season around the corner, the GST relief is expected to boost demand.