GST Rate Changes for Hotels and Restaurant Services wef 01.04.2025

Ministry of Finance, through Notification No. 05/2025-Central Tax (Rate), introduces significant amendments regarding the GST rates for hotel accommodation and restaurant services. Effective from April 1, 2025, the notification omits the definition of “declared tariff” and revises the definition of “specified premises.” The revised definition links the GST rate for restaurant services in hotels to the value of hotel accommodation supplied in the previous financial year. If the accommodation exceeds ₹7,500 per unit per day, the GST rate for restaurant services will be 18% with Input Tax Credit (ITC), and 5% without ITC otherwise. It also allows hotels to opt for 18% GST with ITC for restaurant services, provided they file a declaration before the start of the financial year or upon registration. Furthermore, new declarations for “specified premises” must be filed by registered persons or new applicants. Annexures VII, VIII, and IX introduce formats for “opt-in” and “opt-out” declarations, to be submitted by January 31 of the preceding financial year, with a 15-day window for new taxpayers. The amendments aim to streamline the tax structure and provide clarity on applicable GST rates for the hospitality sector.

MINISTRY OF FINANCE
(Department of Revenue)
New Delhi

Notification No. 05/2025-Central Tax (Rate) | Dated: 16th January, 2025

G.S.R. 38(E).—In exercise of the powers conferred by sub-sections (1), (3), and (4) of section 9, sub-section (1) of section 11, sub-section (5) of section 15 and section 148 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on being satisfied that it is necessary in the public interest so to do, on the recommendations of the Council, hereby makes the following further amendments in the notification number 11/2017-Central Tax (Rate), of the Government of India, in the Ministry of Finance (Department of Revenue), published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (i), vide number G.S.R. 690(E), dated the 28th June, 2017, namely:-

In the said notification, –

(i) in paragraph 4 relating to Explanation, with effect from the 1^st day of April, 2025,-

(a) clause (xxxv) shall be omitted;

(b) for clause (xxxvi), the following clause shall be substituted, namely:­“ (xxxvi) “Specified premises”, for a financial year, means,-

(a) a premises from where the supplier has provided in the preceding financial year, ‘hotel accommodation’ service having the value of supply of any unit of accommodation above seven thousand five hundred rupees per unit per day or equivalent; or

(b) a premises for which a registered person supplying ‘hotel accommodation’ service has filed a declaration, on or after the 1st of January and not later than 31st of March of the preceding financial year, declaring the said premises to be a specified premises; or

(c) a premises for which a person applying for registration has filed a declaration, within fifteen days of obtaining acknowledgement for the registration application, declaring the said premises to be a specified premises;”;

(ii) after Annexure VI, the following Annexures shall be inserted, namely:—

“Annexure VII

OPT-IN DECLARATION FOR REGISTERED PERSON
(See para 4(xxxvi))

Declaration by a registered person supplying hotel accommodation service before the jurisdictional GST authority declaring the premises to be a ‘specified premises’.

Reference No.-

Date: –

1. I/We……………………………… (name of Person) do hereby declare that the premises at…….. (address)……. shall be a ‘specified premises’ for the Financial Year…………. (yyyy-yy)………….

2. Further, I/We understand the said declaration will apply to the entire Financial Year specified in (1) above and will continue to apply to subsequent Financial Years also, unless I/We declare the premises as not a ‘specified premises’ by filing a declaration in the format specified at Annexure IX.

Legal Name: –

GSTIN: –

PAN No.

Name of Authorized Signatory:

Signature of Authorized Signatory:

(Dated acknowledgment)

Note:

1. The above declaration, declaring the premises as a ‘specified premises’ for a Financial Year, shall be filed by a registered person on or after 1^st of January of the preceding Financial Year but not later than 31st of March of the preceding Financial Year.

2. The above declaration shall have to be filed separately for each premises.

Annexure VIII

OPT-IN DECLARATION FOR PERSON APPLYING FOR REGISTRATION
(See para 4(xxxvi))

Declaration by a person applying for registration before the jurisdictional GST authority declaring the
premises to be a ‘specified premises’.

Reference No.-

Date: –

1. I/We……………………………….. (name of Person) have applied for registration vide ARN No…………………………………. and do hereby declare that the premises at…….. (address)…… shall be a ‘specified premises’ from the effective date of registration till the end of the Financial Year.

2. Further, I/We understand the said declaration will apply to the subsequent Financial Years also, unless I/We declare the premises as not a ‘specified premises’ by filing a declaration in the format specified at Annexure IX.

Legal Name: –

ARN: –

PAN No.

Name of Authorized Signatory:

Signature of Authorized Signatory:

(Dated acknowledgment)

Note: The above declaration shall have to be filed separately for each premises.

Annexure IX

OPT-OUT DECLARATION
(See para 4(xxxvi))

Declaration by a registered supplier of hotel accommodation service before the jurisdictional GST authority declaring the premises as not a ‘specified premises’.

Reference No.-

Date: –

1. I/We……………………………….. (name of Person) do hereby declare that the premises at ………….. (address)………. shall not be a ‘specified premises’ for the Financial Year…………. (yyyy-yy)………..

2. Further, I/We understand the said declaration will apply to the entire Financial Year specified in (1) above and will continue to apply to subsequent Financial Years also, unless I/We declare the premises to be a ‘specified premises’ by filing a declaration in the format specified at Annexure VII.

Legal Name: –

GSTIN/ARN: –

PAN No.

Name of Authorized Signatory:

Signature of Authorized Signatory:

(Dated acknowledgment)

Note:

1. The above declaration, declaring the premises as not a ‘specified premises’, for a Financial Year, shall be filed on or after 1^st of January of the preceding Financial Year but not later than 31st of March of the preceding Financial Year.

2. The above declaration shall have to be filed separately for each premises.”.

[F. No. 190354/2/2025-TO (TRU-II)]
MD. ADIL ASHRAF, Under Secy.

Note: -The principal notification number 11/2017 -Central Tax (Rate) was published in the Gazette of India, Extraordinary, vide number G.S.R. 690 (E), dated the 28th June, 2017 and last amended vide notification number 07/2024-Central Tax (Rate) published in the Gazette of India vide number G.S.R. 617(E), dated the 8^th October, 2024.