GST on state-run lotteries fixed at 12%; hotels charging below Rs 7,500 placed under 18% tax bracket

Mohammed Uzair Shaikh
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New Delhi, June 18: The GST Council on Sunday finalised the tax rates for lotteries. While state-run lotteries would be charged at 12 per cent, those authorised by the state would attract a GST of 28 per cent. The Council also decided to lower the tax rate on hotels, charging less than Rs 7,500 per night.

“State run lotteries will be taxed at 12 per cent of the face value and state authorised lotteries at 28 per cent,” Finance Minister Arun Jaitley said, while addressing the press here.

Hotels, charging above Rs 2,500 per night, were earlier placed in the highest – 28 per cent tax slab. However, the Council has not decided to charge hotels availing per night rent between Rs 2,500 to Rs 7,500 in the 18 per cent tax bracket.

“28 per cent limit in hotels will start from Rs 7,500. Those charging between Rs 2,500-Rs 7,500 (per night), the rate will be 18 per cent,” Jaitley said. For restaurants attached to hotels, the rate would remain at par with those charged at air-conditioned eateries. “GST on restaurants in these hotels will be at par with other air-conditioned restaurants, that is 18 per cent,” he added.

Jaitley brushed aside the apprehensions raised by few states regarding the ‘hasty’ roll-out of GST. The Finance Minister said those who are not ready may continue to find excuses ahead as well. “We don’t have luxury of time to defer implementation of GST. Council decided categorically it will be implemented from 1st July onwards. The official launch of the GST will take place on the midnight of 30th and 1st at a function in Delhi.”

West Bengal Finance Minister Amit Mitra is among the leading voices from the state, seeking deferment in roll-out of GST by at least a month. According to Mitra, the “jugaad” to meet the July 1 target could raise severe obstacles later. However, his claim was contested by Maharashtra Finance Minister Sudhir Mungantiwar in the previous GST Council meet. “We should bring GST into implementation from July 1 and if there crops any issue GST Council can resolve it promptly,” he said, adding that further delay would lead to more complexities.