New Delhi, September 20: The Goods and Services Tax Council on Friday decided to make the hotel rooms -- under Rs 1,000 -- GST-free. Apart from this, the Council -- chaired by Union Finance Minister Nirmala Sitharaman -- decided to slash that GST on hotel tariffs of 7,500 and above will be at 18 percent. However, the GST that would be applied to hotel rooms above Rs 1,000 and below Rs 7,500 would be 12 percent. The GST council approved the proposal for outdoor catering and reduced it to 5 percent without the input tax credit.

According to the latest information from the sources, the Union Finance team in discussion with the GST Council officials, decided to forego the tax on hotel rooms that are priced below Rs 1,000. Also, the GST Council agreed to consider the proposal of the hotel industry amid the economic crisis. The council decided to slash that GST rate for hotel rooms that were charged above Rs 1,000. GST Council Approves Proposal to Hike Rates on Caffeinated Drinks; Soft Drinks, Energy Drinks And All Other Drinks Set to Become Expensive

Here is the difference between the GST rates for hotel rooms:

Hotel Rooms Rate (in INR)

Old GST Rate (in %)

New GST Rates (in %)

Less than Rs 1,000 0 0
1,000-2,499 12 12
2,499-7,499 18 12
More than 7,500 28 18

Earlier, the GST Council has hiked tax rate on caffeinated drinks from 18 percent to 28 percent. Additionally, 12 percent of cess would also be charged under the new Goods and Services Tax (GST) rules. Apart from this, the Minister approved the waving off GST filing for dealers below 2 two crores turn over, while the state that the procedure for those with more than Rs 2 crore turnover would be simplified.

(The above story first appeared on LatestLY on Sep 20, 2019 08:24 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).