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Hospitality sector is not insulated. General industries falling under the sector are lodging, food and beverage, travel and tourism and recreation. Lodging up to 30 June, 2017 was subject to Service Tax as well as Luxury Tax, with limited exemptions. From 1 July, 2017, GST era, renting of such accommodation falls under Service category and subject to taxability as follows: 

a) Rent per day or equivalent, per room, is less than Rs 1,000, it is exempted from GST 

b) Rent is Rs 1,000 or more but less than Rs 2,500, GST of 12% is leviable 

c) Rent per day or equivalent, per room, is Rs 2,500 or more but less than Rs 7,500, GST of 18% is leviable 

d) Rent per day or equivalent, per room, (including 5-Star or above rated hotel) is Rs 7,500 and above, GST of 28% is leviable on the room 

Input Tax Credit is available on Inputs, Capital Goods and Input Services in all the above cases, except exempted service in case (A)