Hotel GST in India changed meaningfully in 2025, and the new structure is good news for most independent hotels. Here's the current 2026 picture, in plain language.
This is general information, not tax advice. GST rules change — confirm the current rates and your obligations with a qualified chartered accountant.
The current hotel room GST rates
Since the reform effective 22 September 2025, GST on hotel rooms is based on the room tariff:
| Room tariff per night | GST rate | Input Tax Credit |
|---|---|---|
| Up to ₹7,500 | 5% | Not available |
| Above ₹7,500 | 18% | Available |
The big change: rooms up to ₹7,500 moved from 12% to 5%, which lowers the tax most independent hotels charge. Note that the rate depends on the tariff, not your star rating.
Restaurant and food is taxed separately
Room and food are billed under separate GST treatment. In hotels whose rooms stay at or below ₹7,500, the in‑house restaurant is generally 5% (no input credit). In "specified premises" — where any room crossed ₹7,500 in the previous year — restaurant service is 18% (with input credit). Keep these on separate line items.
What your invoice must show
A compliant tax invoice isn't just a printed bill. It needs:
- Your hotel's name, address and GSTIN
- A unique, sequential invoice number and date
- The guest's details (and GSTIN, if they want input credit)
- A clear description of the stay
- The taxable value, the GST rate, and CGST + SGST shown separately (or IGST for inter‑state corporate billing)
Corporate guests in particular need a proper GST invoice to claim input credit, so getting these fields right protects both you and your guest.
Why this is hard to do by hand
Applying the correct slab per booking, splitting CGST/SGST, numbering invoices sequentially, and keeping records for filing is fiddly and error‑prone on paper or in a spreadsheet — and small mistakes add up at filing time.
How BitLegacy Hotels helps
BitLegacy Hotels generates GST‑compliant invoices automatically — the right slab, CGST/SGST split, sequential numbering and your GSTIN — so billing is correct every time, without manual calculation. Start a 60‑day free trial and see it on your own bookings.
Frequently asked questions
What is the GST rate on hotel rooms in India in 2026?
Following the reform effective 22 September 2025, rooms with a tariff up to ₹7,500 per night are taxed at 5% (without input tax credit), and rooms above ₹7,500 per night at 18% (with input tax credit). The rate is based on the room tariff, not the hotel's star rating. Always confirm current rates with your accountant, as GST rules change.
Is GST charged on hotel restaurant food separately?
Yes. Room and food are taxed separately. In hotels where rooms stay at or below ₹7,500, in-house restaurant service is generally 5% without input tax credit; in 'specified premises' where a room crossed ₹7,500, it is 18% with input tax credit.
What must a hotel GST invoice include?
Your hotel's name, address and GSTIN, a unique invoice number and date, the guest's details (and GSTIN if they want input credit), a description of the stay, the taxable value, the GST rate, and CGST and SGST shown separately.
About the author
Captainjeet Kaur
Managing Director, BitLegacy Solutions LLP
Captainjeet Kaur leads BitLegacy Solutions LLP, the team behind BitLegacy Hotels — hotel management software for independent Indian hotels — and writes about running and growing hotels with simple, practical technology.
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