GST Price Cut on Hotel Stays & Flight Tickets: The GST Council has reduced taxes on hotel and flight tickets. Hotel rooms under ₹7,500 will now be subject to only 5% GST, and economy class tickets will be subject to 5% GST. This will boost domestic tourism and save money for ordinary people.
GST Price Cut on Hotel Stays & Flight Tickets: If you’re planning a trip during the festive season, now’s a good opportunity. Recently, the GST Council decided to impose a significant tax cut on hotel and flight tickets. These new rates have come into effect today, September 22, 2025.
GST on Hotel Rooms Reduced
Hotel rooms with rates less than ₹7,500 will now be subject to only 5% GST, compared to 12% previously. Budget hotels with rates less than ₹1,000 will remain tax-free as before. However, premium hotel rooms above ₹7,500 will remain subject to the same 18% GST.
Flight Tickets Also Cheaper
Good news for air travelers. Economy class tickets will now attract only 5% GST, down from 12% previously. This will make air travel more affordable for the general public. However, business class tickets will now be subject to 18% GST instead of 12%.
Breathing New Life into the Travel Industry
MakeMyTrip co-founder and CEO Rajesh Magow says this move will directly boost domestic travel. Family vacationers and those on religious trips will benefit the most.
Luxury travelers will be in for a shock
Luxury travel is about to become more expensive. Private jets and helicopters will now be charged a flat 40% GST, up from 28% GST + 3% compensation cess, totaling approximately 31%. The same rate will apply to yachts and luxury boats, meaning they previously had an effective tax rate of 31%, which will now be 40%. Furthermore, the GST on business class and first class flight tickets has increased to 18%, up from 12% previously. This means that high-end travelers are now in for a significant blow.
The GST reduction is set to revitalize the tourism and hotel industries. Demand in the sector, which has slowed since the COVID-19 pandemic, is expected to increase. Ordinary people will now be able to take advantage of affordable hotels, affordable flights, and light meal bills. However, luxury travelers will have to spend a little more. The government’s goal is to encourage more people to travel, and to levy slightly higher taxes on those who use high-end services.
