Applicable Tax Rate

[VIGNESH]

sir, accomodation service provided by a hotel in tamil nadu , which has highest room tariff of ₹ 7000/- and charges 12% tax rate, my question is - when Rooms are given to SEZ unit in tamil nadu for accomodation of employees , what is the tax applicable?, Tax rate applicable?. kindly clarrify

[Rajagopalan Ranganathan]

Sir,

The accommodation service is availed by you out side the SEZ Area. Therefore it is taxable. Only gst paid on goods or services or both are consumed within SEZ area they are exempted from payment of gst. Since the said service is consumed outside SEZ area you canno claim refund of gst paid on the ground of import of such service.

[KASTURI SETHI]

Dear Querist,

Also go through this decision of AAR.

IN RE : POPPY DOROTHY NOEL - 2019 (10) TMI 619 - AUTHORITY FOR ADVANCE RULING, KARNATAKA

[Ganeshan Kalyani]

I agree with the views of Sri Rajagopalan Sir.

AI Summary

Taxability of hotel accommodation to SEZ employees depends on consumption location; if consumed outside SEZ, GST is payable and not refundable. Accommodation services provided by a hotel outside the SEZ to employees of an SEZ unit are taxable because consumption occurs outside the SEZ; exemptions apply only where goods or services are consumed within the SEZ, and GST paid cannot be refunded solely on the basis that the recipient is an SEZ unit.