India Revamps GST to Boost Tourism and Cultural Heritage

The Government of India has announced significant reductions in Goods and Services Tax (GST) rates, a move expected to enhance tourism affordability, bolster public transport, and provide relief to the country's artisans. According to an official release, the decision aims to create jobs, attract investments, and support cultural heritage in India.

In a move that aligns India's hospitality tax structure closer to global standards, the GST on hotel rooms priced below Rs. 7,500 per day has been slashed from 12% to 5%. This adjustment is anticipated to make hotel stays more affordable for middle-class and budget travelers, potentially increasing foreign visitor numbers. The reform is designed to stimulate a surge in weekend travel and promote heritage and eco-tourism while encouraging investment in mid-range hotels and guesthouses.

Additionally, the GST on buses with a seating capacity of more than 10 persons has been reduced from 28% to 18%. This is expected to cut costs for fleet operators and state transport bodies, lowering ticket prices and encouraging shared and public transport usage, reducing traffic and pollution.

The cultural sector also benefits, with GST on art and cultural goods reduced from 12% to 5%. This change aims to support artisans in traditional cottage industries, promoting economically viable temple art, folk traditions, and craftsmanship.

Between 2021 and 2024, foreign tourist arrivals surged from 15.27 lakh to 99.52 lakh, indicating growing international interest. The government believes the new GST measures will further support this trajectory. Under Prime Minister Narendra Modi's leadership, these reforms are a part of a broader vision for sustainable and inclusive growth, aiming to make India a more appealing destination for both domestic and international tourists.