As part of the Azadi Ka Amrit Mahotsav celebrations, the Government of India has taken another bold step towards inclusive economic growth by announcing major GST reforms targeting the hospitality, transport, and cultural sectors. Under the visionary leadership of Prime Minister Narendra Modi, these reforms aim to make travel more affordable, promote Indian culture, and support small artisans and transport providers—laying the foundation for a stronger, more sustainable tourism ecosystem.
Making Travel Affordable: GST Cut on Hotel Rooms
A key reform includes the reduction of GST on hotel stays priced below ₹7,500 per day from 12% to 5% (without ITC). This is a major boost for budget and mid-range travellers, making domestic tourism more accessible for millions of Indians and more attractive for international visitors.
With this change, India aligns more closely with global tourism tax structures, making destinations like pilgrimage sites, heritage cities, and eco-tourism spots more appealing. Moreover, it incentivizes the growth of homestays, guesthouses, and mid-segment hotels, generating employment and improving local infrastructure.
Promoting Sustainable Mobility: Lower GST on Public Transport Buses
In a move aimed at strengthening public transportation, the GST rate on buses with a seating capacity of 10 or more persons has been reduced from 28% to 18%. This will:
- Lower the cost of purchasing buses for schools, tour operators, and state-run services
- Reduce fare prices on semi-urban and rural routes
- Encourage a shift from private to public transport, cutting down congestion and pollution
This reform supports fleet modernization and boosts investment in safer and more comfortable public transport solutions—directly contributing to sustainable development goals.
Empowering Artisans and Cultural Economy
India’s rich heritage and craftsmanship have received a welcome uplift with the GST on art and cultural goods lowered from 12% to 5%. This includes items such as statues, prints, lithographs, ornamental articles, stone inlay work, and more.
This reduction provides direct economic relief to artisans and craftsmen, many of whom work in small-scale or family-run cottage industries. It enables the preservation and promotion of India’s living traditions—such as temple art, miniature painting, and folk sculpture—by making them more competitive in both domestic and international markets.
A Rebound in Tourism
Between 2021 and 2024, India witnessed a spectacular rise in Foreign Tourist Arrivals (FTAs)—from 15.27 lakh in 2021 to 99.52 lakh in 2024, indicating strong global interest and recovery post-COVID. These GST measures are expected to further accelerate this trend by improving affordability and enhancing the overall tourist experience.
Looking Ahead
These GST reforms will have far-reaching impacts:
- Boost in tourism through lower costs for travel and accommodation
- Job creation across hospitality, transport, and cultural sectors
- Preservation of heritage by making traditional arts more economically viable
- Environmental sustainability through greater public transport use
Conclusion
These reforms underscore a strategic commitment to sustainable, inclusive, and culturally rich growth. By making travel affordable, empowering artisans, and promoting shared mobility, the Government is not only boosting the economy but also reinforcing India’s image as a vibrant, welcoming, and culturally proud nation.