Holidays to Become Costlier From 18th July as All Hotel Rooms to be Taxed Under GST

People looking to holiday on a budget must get ready to cough up more for their hotel rooms from 18th July 2022. This is because the Goods and Services Tax (GST) Council has announced that from 18th July , even hotels that charge below Rs1,000 a day will come under the GST net. As per a press release issued by the GST council on June 29, 2022, "Hotel accommodation priced up to Rs1000/day shall be taxed at 12%." (However, the government is yet to issue a notification in this regard.) Up until now, GST exemption was available for hotel rooms up to Rs1,000 per day. 
 
As of now, services by a hotel, inn, guest house, club or campsite for residential or lodging purposes, having value of supply of a unit of accommodation below or equal to Rs1000 per day or equivalent has been exempt from GST. The GST Council has recommended to withdraw the said exemption and apply 12% GST rate thereon. With this rate amendment, effectively all hotels having declared tariff of Rs7500 or below will be liable to GST at the rate of 12%. That said, levy of GST on low-cost hotels will make the holidaying more expensive for common man.
 
How does this impact your holiday expense? Let us assume you book a hotel room for two nights costing Rs900 per night. Prior to GST council announcement, you were required to pay total amount of Rs1,800 and no GST was levied on it. However, from 18 July 2022, onwards, GST at the rate of 12% will be levied. You will be required to pay Rs1800 plus Rs 216 as GST. The total amount payable by you will be Rs2016 as hotel room charges.
 
As a respite, very small-scale hotels will still not be covered under GST if their annual revenues are less than taxable limit of Rs20 lakh
 

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Changes in Our Business Model
 
 
25th Sept 2020
 
Greetings from Moneylife Advisory Services
 
Between financial years 2019-21, SEBI has come up with extensive changes to investor advisor regulations. On Sep 23, 2020, SEBI had issued new additional guidelines. This comes just two months after extensive changes announced in July 2020. Earlier, in December 2019 there was an ad hoc circular
 
As a result of these changes, IAs, cannot accept fees through credit cards, will have to sign a 26-clause investor agreement, have to maintain physical record written & signed by client, telephone recording, emails, SMS messages and any other legally verifiable record for five years. IAs were already asked to record the suitability and rationale for every piece of advice given, sign them and store them for five years.
 
While these extensive and frequent changes, designed to strengthen the conduct of IAs are well-meaning, these have sharply increased compliance efforts and cost. We, being online advisors, find many of changes harder to implement, compared to advisors working in the physical space. We will have to have an army of advisors, administrative and tech staff to be compliant. If we do this, we will have to divert money to these areas and the cost of our service will double. We want to remain the least-cost service in the market to benefit more and more people. In the circumstances, we are forced to change our business model from “advisory” to “research”. This will mean the following:
 
What remains the same:
  • Recommendations on insurance, investment and Lion stocks, will continue as a part of the MAS premium subscription. Our strength has always been research and this will remain available to you through our recommendations.
  • The magazine and all textual content will remain as part of the service
  • We will have to suspend the restructuring tool.
 
What changes:
  • The interactions in Ask / Handholding will offer investment advice but not specific to your situation. It will offer information on investment products and also clarify your doubts about various financial products. It will be a forum for information, not for advice. This will be implemented with immediate effect and our guidelines in Ask, reflect this now.
 
Over the next few weeks our site and our communication to you will reflect these and other additional changes.
 
We feel this will not affect you much in terms of what really matters in investing: knowing what to buy and when to buy. This is our edge and it will still be available to you.
 
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Debashis Basu
Founder