If you are planning a year-end vacation, make sure to consider the impact of GST 2.0.
The new GST rules have changed the overall cost of travel, especially for hotels and flights. With some smart choices, you can make your trip more economical.
Hotel Stay Becomes Cheaper
Good news for budget travelers: now only 5% GST will be charged on hotel rooms costing up to ₹7,500 per night (earlier it was 12%).
Rooms priced above ₹7,500 will attract 18% GST.
Example:
If you book a room for ₹7,000, the GST will now be ₹350 instead of ₹840, saving you ₹490 per night. The total will be ₹7,350.
But if you book a room for ₹8,000, you will pay ₹1,440 GST, making the total ₹9,440.
This means paying ₹1,000 more on the base price actually increases your bill by over ₹2,000.
???? So, the smarter option is to always book a hotel under ₹7,500 per night.
Flight Ticket Costs After 22 September 2025
GST on business, premium economy, and first-class flight tickets will increase from 12% to 18% starting 22 September 2025.
Economy class tickets will continue to have 5% GST.
???? If you need premium travel, book your tickets before 22 September. Even if you fly after that date, the old 12% GST rate will apply to bookings made earlier.
Refund Rule
If you cancel a ticket booked under the old 12% GST, the airline must refund the same GST amount. The change in tax rate later will not affect your refund.
