GST Judgment: Tax Rates for Tour Packages Clarified

The judgment clarified the tax liability under GST for tour packages offering accommodation, food and beverages, and authorized guides. Accommodation with a declared tariff below Rs. 1000 per day is exempt, with varying tax rates based on tariff ranges from 12% to 28%. Separate invoices for food and beverages are required, taxed at 5% without input credit. Authorized guides' services are subject to an 18% GST rate. The ruling emphasized taxing goods and services separately at applicable rates, ensuring compliance with GST regulations for the diverse services provided in the tour packages.

---

---

Issues: Tax liability under GST for tour packages providing separate services like accommodation, food and beverages, authorized guides, trekking accessories.

Tax liability under GST for accommodation services:
The judgment analyzed the tax liability under GST for accommodation services provided by the applicant. It was clarified that the threshold limit for exemption is not based on charges per guest but on the declared tariff of the unit of accommodation. Accommodation with a declared tariff below Rs. 1000 per day is exempt, while different tax rates apply based on the tariff range. The ruling highlighted the specific GST rates applicable depending on the declared tariff, ranging from 12% to 28%. The concept of "declared tariff" was explained to include charges for all amenities provided in the unit of accommodation without excluding any discounts offered.

Tax liability under GST for food and beverages services:
Regarding the tax liability for food and beverages services, it was noted that separate invoices are to be issued for these services. The judgment referred to Notification No. 13/2018-Central Tax (Rate) to determine the applicable GST rate. It specified that the supply of food or drinks by a restaurant or eating joint, excluding those in certain residential or lodging places with specific tariff limits, is taxable at 5% GST without input tax credit. This aspect was crucial in determining the tax liability for food and beverages services provided by the applicant.

Tax liability under GST for service of authorized guides:
The ruling also addressed the tax liability for the service of authorized guides, proposing an 18% GST rate for this service. Reference was made to Circular No. 47/21/2018-GST, emphasizing that the taxability of a supply involving both goods and services should be determined based on individual circumstances. It was highlighted that when the value of goods and services supplied is shown separately, they would be liable to tax at the rates applicable to each component individually.

Overall ruling and conclusion:
In conclusion, the judgment reiterated that the tax liability under GST for tour packages providing separate services should be determined based on the individual components of goods and services supplied. It emphasized that when goods and services are shown separately, they should be taxed at the rates applicable to each component. This comprehensive analysis provided clarity on the tax implications for the various services offered by the applicant in their tour packages, ensuring compliance with GST regulations.

---