New GST on Train Tickets: AC, Non-AC, and Class-wise Tax
- GST is applied to AC and Executive class train tickets in India at a rate of 5%, while non-AC classes are exempt.
- The GST is automatically calculated and included in the total ticket price during booking, whether online or offline.
- When cancelling AC class tickets, GST is deducted from the cancellation charges and is not refundable.
- Business travelers can claim Input Tax Credit on GST paid for AC train travel if their company is GST-registered.
- The SAC code for passenger transport by rail is 9964, which is needed for claiming GST credits.
If you’re traveling by train in India, especially in AC classes or premium categories, GST is part of your ticket cost. Indian Railways, like airlines, applies GST on certain types of tickets. In this blog, we’ll explain how gst on train tickets works, what classes are taxed, and what to know about cancellations and refunds.
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New GST Rate on Railway Tickets in India
The Government of India is updating GST rates effective after 22 Sep 2025. Below are the expected new GST rates for railway tickets (no compensation cess).
New GST in Railway Tickets
| Train Class | New GST Rate | GST Applicable? |
|---|---|---|
| AC First Class / Executive Class | 5% | Yes |
| AC 2-Tier, 3-Tier, Chair Car | 5% | Yes |
| Sleeper Class, Second Sitting (2S) | 0% | No (Exempt) |
| General Class (Unreserved) | 0% | No (Exempt) |
Train Class
New GST Rate
GST Applicable?
Train Class
New GST Rate
GST Applicable?
Train Class
New GST Rate
GST Applicable?
Train Class
New GST Rate
GST Applicable?
Old GST in Railway Tickets: When Does It Apply?
(Old GST Rates – Applicable Until 21st September)
GST is applicable only on certain categories of railway travel. The rate depends on the class of travel.
| Train Class | GST Rate | GST Applicable? |
|---|---|---|
| AC First Class / Executive Class | 5% | Yes |
| AC 2-Tier, 3-Tier, Chair Car | 5% | Yes |
| Sleeper Class, Second Sitting (2S) | 0% | No (Exempt) |
| General Class (Unreserved) | 0% | No (Exempt) |
Train Class
GST Rate
GST Applicable?
Train Class
GST Rate
GST Applicable?
Train Class
GST Rate
GST Applicable?
Train Class
GST Rate
GST Applicable?
So, if you’re traveling in AC, gst in railway ticket is 5%, while there’s no GST on non-AC classes.
GST on Train Ticket Booking
GST is applied during railway ticket booking—both online (IRCTC) and offline. It is:
- Automatically calculated and shown on the final fare
- Included in the total ticket price
- Applicable only when booking AC or Executive class tickets
So, if you’re making a railway ticket booking for AC 2-tier, your ticket will show a separate GST component at 5%.
GST on Train Ticket Cancellation
Yes, GST is also involved during ticket cancellations—but only for AC classes.
Key rules:
- GST is deducted from the cancellation charges
- Refund is issued after deducting GST-inclusive cancellation fee
Example:
- AC 3-tier ticket: ₹1,000
- Cancellation charge (with GST): ₹60 (₹57 + ₹3 GST)
- Refund issued: ₹940
So, you don’t get back the GST on the cancellation fee. The gst on train ticket cancellation is retained as part of the charge.
Input Tax Credit (ITC) on Train Tickets
If you are a business traveler or booking through a company:
- You can claim Input Tax Credit on GST paid on AC train travel
- Your company must be GST-registered
- Invoice should include your GSTIN and proper HSN/SAC code
The SAC Code for passenger transport by rail is 9964.
Conclusion
Knowing the gst on train tickets helps you understand your fare breakup better. Whether you travel frequently or manage bookings for a company, being aware of these GST rules helps you save time and claim eligible credits .
