The Goods and Services Tax (GST) has brought significant changes to various sectors in India, including the aviation industry. Whether you’re a frequent flyer, a business traveler, or simply curious about how GST affects air travel, this guide will provide you with all the necessary information about GST on air tickets, including rates, exemptions, and how to claim GST.
GST Rates on Air Tickets
The GST rates on air tickets vary depending on the class of travel and the type of flight (domestic or international):
- Economy Class: The GST rate for economy class flight tickets is 5%.
- Business Class: The GST rate for business class flight tickets is 12%.
GST on Domestic Air Tickets
For domestic flights within India, the GST rates are as follows:
- Economy Class: 5%
- Business Class: 12%
These rates apply to all domestic airlines operating within the country.
GST on International Flight Tickets
International flight tickets are zero-rated under GST. This means that while the ticket itself is not subject to GST, businesses can claim input tax credit (ITC) on related travel expenses if the travel is for business purposes.
How to Calculate GST on Air Tickets
Calculating GST on air tickets is straightforward. Here’s a simple formula:
[ \text{GST Amount} = \text{Base Fare} \times \text{GST Rate} ]
For example, if the base fare of an economy class domestic flight is ₹10,000, the GST amount would be:
[ \text{GST Amount} = ₹10,000 \times 5\% = ₹500 ]
GST Calculator for Air Tickets
How to Claim GST on Flight Tickets
Businesses can claim input tax credit (ITC) on flight tickets if the travel is for business purposes. To claim ITC, ensure that:
- The flight ticket is booked in the name of the business.
- A GST-compliant invoice is provided by the airline or travel agent.
- The GST details are correctly mentioned on the invoice.
GST on Air Tickets Booking Agents
Booking agents who facilitate the purchase of air tickets are also subject to GST. The GST rate for services provided by booking agents is 18%. This rate applies to the service fee or commission charged by the agent.
Taxes on Airline Tickets in India
Apart from GST, airline tickets in India may include other charges such as:
- Passenger Service Fee (PSF)
- User Development Fee (UDF)
- Fuel Surcharge
These charges are added to the base fare and are subject to GST.
Air Ticket HSN Code and GST Rate
The Harmonized System of Nomenclature (HSN) code for air transport services is 9964. The GST rates for air tickets are:
- Economy Class: 5%
- Business Class: 12%
Read to know How Does Circular No. 243/2024 Clarify the GST Treatment of Vouchers?
Frequently Asked Questions (FAQs)
- How to calculate GST on air tickets?
- To calculate GST on air tickets, multiply the base fare by the applicable GST rate (5% for economy class and 12% for business class).
- What is the GST on international flight tickets?
- International flight tickets are zero-rated under GST, meaning no GST is charged on the ticket itself, but businesses can claim input tax credit on related travel expenses.
- How to claim GST on flight tickets?
- Businesses can claim input tax credit on flight tickets by ensuring the ticket is booked in the business’s name, obtaining a GST-compliant invoice, and having the correct GST details on the invoice.
- What is the GST on domestic air tickets?
- The GST rate for domestic air tickets is 5% for economy class and 12% for business class.
- What is the GST rate for air ticket booking agents?
- The GST rate for services provided by air ticket booking agents is 18%.
Conclusion
Understanding the GST rates and regulations for air tickets is essential for both businesses and individual travelers. By staying informed about these rates and how to claim input tax credit, you can ensure compliance with tax regulations and manage your travel expenses more effectively.