New Delhi : The newly implemented GST reforms are set to strengthen India’s domestic tourism sector, making travel more affordable for middle-class and budget travellers while promoting cultural heritage and attracting investment in hospitality and related industries, according to a government statement on Monday.
Under the revised tax structure, GST on hotels costing less than Rs 7,500 per day has been reduced from 12% to 5%, enabling budget-friendly stays and encouraging weekend getaways, pilgrimage tourism, heritage trails, and eco-tourism. The move is also expected to stimulate investment in mid-segment hotels, homestays, and guesthouses, generating employment and improving tourism infrastructure.
Public transport is another key beneficiary. GST on buses with seating capacity over 10 people has been lowered from 28% to 18%, helping reduce ticket fares on semi-urban and rural routes. This is expected to encourage the use of shared transportation, alleviate congestion, reduce pollution, and support fleet expansion and modernisation for safer, more comfortable travel.
The reforms also extend to India’s art and cultural sector. GST on statues, statuettes, original engravings, prints, lithographs, ornamental articles, stone artware, and stone inlay work has been reduced from 12% to 5%, providing direct support to artisans, craftsmen, and sculptors involved in traditional cottage industries.
Government data shows that Foreign Tourist Arrivals (FTAs) have rebounded strongly post-pandemic, rising from 15.27 lakh in 2021 to 99.52 lakh in 2024, highlighting the sector’s rapid recovery and the potential for further growth under the new GST framework.
The reforms aim to foster sustainable and inclusive growth in tourism, stimulate investments, and create new jobs across hospitality, transport, and traditional crafts, accelerating India’s post-pandemic economic recovery.