The most searched GST question from hotels is simple: what is the current GST rate on hotel rooms in India? The answer is simple only if your rate table is current and your booking system applies it consistently.
As of May 2026, hotel accommodation is listed under SAC 9963. The Ministry of Finance / PIB FAQ on the 56th GST Council reforms confirms the rate rationalisation effective from September 22, 2025. Hotels should still confirm the latest position with their CA because GST notifications can change and state-level audit expectations vary.
The accommodation rate table
- Value of supply up to ₹7,500 per unit per day: 5% GST without ITC.
- Value of supply above ₹7,500 per unit per day: 18% GST with ITC.
For intra-state supplies, the tax splits equally into CGST and SGST. A 5% accommodation invoice shows 2.5% CGST and 2.5% SGST. An 18% invoice shows 9% CGST and 9% SGST. For IGST cases, the full rate appears as IGST.
What "unit per day" means in practice
The threshold is not your hotel's average daily rate. It is tested for the unit of accommodation per day. If a booking has three rooms, calculate each room unit correctly. If a package includes accommodation and a meal plan as a bundled accommodation product, finance should review whether the package crosses the threshold.
The operational rule is straightforward: never let the front desk manually choose a slab from memory. Configure the tax rules once and let the PMS apply them from booking data.
Example 1: Mid-market room
- Room value: ₹6,000 per night
- GST slab: 5%
- GST: ₹300
- Total: ₹6,300
On an intra-state invoice, this appears as ₹150 CGST and ₹150 SGST.
Example 2: Premium room
- Room value: ₹8,500 per night
- GST slab: 18%
- GST: ₹1,530
- Total: ₹10,030
On an intra-state invoice, this appears as ₹765 CGST and ₹765 SGST.
Example 3: Room plus package inclusions
A resort sells a room at ₹6,900 with a mandatory dinner package of ₹900. The visible "room" number may look below ₹7,500, but the bundled accommodation package can cross the threshold. The finance team should define the package treatment before the rate goes live. The safest operating model is to configure package tax logic centrally in hotel finance software instead of relying on checkout-time judgement.
Common errors
- Using an old 0%/12% slab table. Hotel GST rates changed from September 22, 2025; old blog posts and templates are often wrong.
- Splitting 5% incorrectly. It must be 2.5% CGST and 2.5% SGST, not an uneven split.
- Applying restaurant GST to accommodation packages. A room package and a walk-in restaurant bill are not the same thing.
- Forgetting credit notes. Cancellation and rate corrections should reverse GST properly.
How Hotelary keeps rates clean
Hotelary's GST invoicing stores tax slabs centrally, applies them at folio line level, and exports data for GSTR-1 and GSTR-3B review. When a rate changes, finance updates the tax table once; front desk and WhatsApp bookings inherit the rule automatically.
Further reading
- Ministry of Finance / PIB FAQs on 56th GST Council reforms for hotel accommodation ITC clarification.
- GST Council press release on 56th meeting recommendations for the rate rationalisation table.
- GST Portal for return filing and advisories.
- For filing workflow, use our GSTR-1 and GSTR-3B guide.
Disclaimer: This guide reflects official PIB/GST Council guidance reviewed on May 4, 2026. Confirm current GST treatment with a chartered accountant before filing.
