GST for Tours and Travel Services in India

Tourism is one of India’s fastest-growing sectors, offering everything from luxury holiday packages to local sightseeing tours. If you run a travel business or book travel services, understanding the gst for tours and travels is key to pricing and compliance.

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    GST Applicability on Tour and Travel Services

    All tour operators, travel agents, and agencies providing services like:

    • Holiday packages
    • Sightseeing tours
    • Hotel and flight bookings
    • Car rentals with a driver

    are required to register under GST if their turnover exceeds ₹20 lakhs (₹10 lakhs for special category states).

    GST Rate for Tours and Travels

    Service Type SAC Code GST Rate
    Domestic tour packages (all-inclusive) 9985 5% (No ITC)
    International tour packages 9985 5% (No ITC)
    Hotel bookings (on behalf of customer) 9963 18%
    Air ticket booking (commission-based) 9985 18%
    Car rental with driver 9966 5% / 12%

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    GST for Tour Packages: Domestic vs International

    Domestic Tour Packages:

    • GST @ 5% on the total package value
    • No ITC allowed (as per Rule 32 of CGST Rules)
    • Applies to packages that include stay, transport, food, and activities

    International Tour Packages:

    • Even though services are partly outside India, GST @ 5% is charged on the total value
    • Foreign exchange earnings are not exempt from GST

    Billing and Invoicing for Tour Operators

    • Mention correct SAC code 9985 on invoices
    • Apply 5% GST without ITC, or opt for 18% GST with ITC
    • File regular GSTR-1 and GSTR-3B
    • Maintain clear breakup of package components for transparency

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    GST on Air and Hotel Bookings

    • GST is charged only on your commission as an agent
    • Airline or hotel GST is billed by the provider
    • You charge 18% GST on the service or convenience fee

    Input Tax Credit (ITC) Rules

    Item ITC Allowed?
    Hotel, travel, and dining costs for package ❌ No (if under 5%)
    Office rent, equipment, ads ✅ Yes (if GST @18%)
    Services resold without bundling ✅ Yes

    Conclusion

    Whether you’re planning a trip or running a travel agency, understanding the GST for tours and travels helps with pricing transparency and ensures your business remains GST-compliant.

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