The Central govt. has issued some clarification regarding levy of GST on supply of service of accommodation of services which are discussed as below:
Let’s understand the term declared Tariff
Tariff declared anywhere, say on the websites through which business is being procured or printed on tariff card or displayed at the reception will be the declared tariff. In case different tariff is declared at different places, highest of such declared tariffs shall be the declared tariff for the purpose of levy of GST.
How GST will be charged on actual tariff for accommodation service when “actual tariff” and “declared tariff” are different?
Declared tariff or published tariff is relevant only for determination of the tax rate slab while GST will be payable on the actual amount charged by the service provider i.e., transaction value.
Tax rate will be as per slab rates given-
|Slab (Rs.)||Tariff Rate|
|7501 and above||28%|
Illustration1: if the declared tariff is Rs. 7000 per unit per day but the amount charged from the customer on account of extra bed is Rs. 8000,
As Tariff declared is Rs. 7000 per unit so the tax will be charged at 18% on the amount actually charged i.e., Rs. 8000
Illustration2: If declared tariff of the accommodation provided by way of upgrade is Rs 10000, but amount charged is Rs 7000.
As Tariff declared is Rs. 10,000 per unit so the tax will be charged at 28% on the amount actually charged i.e., on Rs. 7000/-
Do you know what Dynamic pricing sense of? Which rate will be charged?
Dynamic pricing means different tariff is declared at different times for same room, for different seasons or period of the year
In this kind of case, the tariff amount that is declared for that particular season in which the service of accommodation for room is provided, shall apply.
Some Salient inquest about Declared Tariff!
On what value tax will be charged, if tariff amount charged by the service provider changes between the date of actual usage and booking date?
Booking date means the date on which service has been booked and advance payment has been made.
Actual usage date means the date on which service of accommodation has been actually provided or supplied to the customer.
In this case, the tariff which is declared at the time of actual supply of service, would apply.
It also has been spotted that price/declared tariff does not include tax components for the purpose of admission to cinema and Accommodation in hotels, inns, etc.