GCCI seeks uniform GST for hospitality

Panaji: The Goa Chamber of Commerce and Industry (GCCI) has asked Union finance minister Nirmala Sitharaman to reduce the GST on all hotel bookings to 12%. This move will benefit Goa’s hospitality sector as it competes with destinations like Sri Lanka and southeast Asian nations, where tax structure is more competitive.

GCCI wrote to the finance minister and also said that restaurants should be given the option to choose between 5% GST without input tax credit or 12% GST with input tax credit.

“Unified GST rate for hotel accommodation will make travel more affordable and boost India’s tourism sector,” GCCI stated. Currently, the GST rate on hotel rooms varies based on the room tariff which is 12% for tariffs up to Rs 7,500 per night and 18% for tariffs above Rs 7,500 per night. These inputs are part of the pre-budget recommendations ahead of the Union Budget 2025-26. “Rationalising GST rates and slabs is essential to correct inverted duty structures, avoid cascading effects, and reduce classification disputes.

Reviewing ‘blocked’ credits and state taxes is equally critical to ensure a seamless value chain,” said GCCI in its wishlist. GCCI’s recommendations emphasise tax simplification, ease of doing business, and measures to stimulate economic growth while addressing ongoing challenges, litigation, and uncertainty due to frequent amendments, said GCCI director general Sanjay Amonkar. GCCI said the review to simplify income tax provisions is in the right direction but needs to provide relief to taxpayers. GCCI suggested that amendments should take effect from the beginning of the financial year. “Proposed raising the basic income tax exemption limit to Rs 5 lakh and increasing rebates under Section 87A to Rs 10 lakh under the new regime,” said Amonkar.

GCCI called for abolition of cesses and surcharges, which increase the tax burden. “We have recommended extending the concessional 15% tax rate for new manufacturing companies to boost India’s manufacturing sector. We have also advocated extending presumptive taxation benefits to limited liability partnerships and easing conversion rules for private companies to LLPs to promote ease of doing business,” said Amonkar. GCCI also requested faster disposal of appeals at the commissioner of income tax (appeals) stage.

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