+
GST Council exempts hostel accommodation services
ECONOMY & POLICY

GST Council exempts hostel accommodation services

The GST Council's recommendation to exempt GST on accommodation services charging up to Rs 20,000 per month will benefit the co-living industry and thousands of students and corporate employees, say industry experts. Previously, there was 18% GST on the services.

According to Abhishek A. Rastogi, founder of Rastogi Chambers, recent years have seen ambiguity regarding GST on residential dwellings. He stated that a new notification clarifies that hostels and accommodations for working professionals are exempt from GST within certain limits. He mentioned that tenants would not qualify for the exemption if the stay is less than 90 days or if the monthly payment per person exceeds Rs 20,000.

Bharath Bhaskar, co-founder of Settl, a coliving operator, expressed industry players' view that while the recommendation provides clarity in the short term, there should be a long-term classification of these accommodations as residential dwellings, thereby exempting them from GST without any limits. He suggested that such a change would lessen the financial burden on end customers, helping them save on rental expenses.

Rami Kaushal, managing director, consulting & valuation services, India, Middle East & Africa, CBRE, mentioned that experts believe tax exemption for co-living and student housing sectors could significantly enhance affordability and attract a broader tenant base, including young working professionals and students pursuing higher studies away from home. He anticipated sustained growth in these sectors, fostering a more dynamic and accessible housing market in India's urban centres.

Sunny Garg, co-founder of CRIB, a PropTech startup, noted that the exemption is expected to benefit numerous hostels and co-living companies, particularly those in the student housing segment, where monthly charges generally fall below the specified threshold nationwide. He highlighted that the condition requiring accommodation services to be supplied for a minimum continuous period of 90 days is easily met in the case of student co-living arrangements and hostels, which typically involve longer lease or stay durations.

The GST Council's recommendation to exempt GST on accommodation services charging up to Rs 20,000 per month will benefit the co-living industry and thousands of students and corporate employees, say industry experts. Previously, there was 18% GST on the services. According to Abhishek A. Rastogi, founder of Rastogi Chambers, recent years have seen ambiguity regarding GST on residential dwellings. He stated that a new notification clarifies that hostels and accommodations for working professionals are exempt from GST within certain limits. He mentioned that tenants would not qualify for the exemption if the stay is less than 90 days or if the monthly payment per person exceeds Rs 20,000. Bharath Bhaskar, co-founder of Settl, a coliving operator, expressed industry players' view that while the recommendation provides clarity in the short term, there should be a long-term classification of these accommodations as residential dwellings, thereby exempting them from GST without any limits. He suggested that such a change would lessen the financial burden on end customers, helping them save on rental expenses. Rami Kaushal, managing director, consulting & valuation services, India, Middle East & Africa, CBRE, mentioned that experts believe tax exemption for co-living and student housing sectors could significantly enhance affordability and attract a broader tenant base, including young working professionals and students pursuing higher studies away from home. He anticipated sustained growth in these sectors, fostering a more dynamic and accessible housing market in India's urban centres. Sunny Garg, co-founder of CRIB, a PropTech startup, noted that the exemption is expected to benefit numerous hostels and co-living companies, particularly those in the student housing segment, where monthly charges generally fall below the specified threshold nationwide. He highlighted that the condition requiring accommodation services to be supplied for a minimum continuous period of 90 days is easily met in the case of student co-living arrangements and hostels, which typically involve longer lease or stay durations.

Next Story
Infrastructure Energy

Bihar Launches Rs 53.4 Billion Green Energy Plan

The Bihar government has taken a major stride towards clean energy with the launch of two new policies and the signing of agreements totalling Rs 53.4 billion. These initiatives aim to generate 2,357 megawatts (MW) of renewable energy through solar, wind, battery storage, and other sustainable technologies.The Bihar Renewable Energy Policy 2025 and the Pump Storage Policy 2025 were officially introduced at an event in Patna. Designed to attract significant investment, the policies seek to position Bihar as a key centre for clean energy projects. Energy Minister Bijendra Prasad Yadav stated tha..

Next Story
Infrastructure Transport

Bids Invited for Rs 62.5 Billion Vizag Metro Project

The long-anticipated Visakhapatnam Metro Project has made significant progress, with the Andhra Pradesh Metro Rail Corporation inviting bids for the first civil contract under Phase 1 of the Vizag Metro. The estimated cost of this contract is Rs 62.5 billion.This engineering, procurement and construction (EPC) contract covers the design and construction of a 46.23 km viaduct spanning three corridors, including a 20.16 km double-decker four-lane flyover cum metro viaduct. The project also comprises 42 elevated metro stations across Visakhapatnam.Recently, SYSTRA Consultancy signed a Memorandum ..

Next Story
Real Estate

Oberoi Realty to Buy Hotel Horizon for Rs 9.19 Billion

A consortium led by Mumbai-listed Oberoi Realty Ltd is set to acquire debt-laden Hotel Horizon Pvt Ltd in Juhu, Mumbai for Rs 9.19 billion (approximately USD 107 million) under a resolution plan approved through India’s Insolvency and Bankruptcy Code (IBC).In a filing to the stock exchange, Oberoi Realty confirmed that the Committee of Creditors of Hotel Horizon had approved the resolution plan, following which a letter of intent was issued. The consortium also includes Shree Naman Developers and JM Financial Properties.As per the resolution plan, the consortium will make a payment of Rs 9.1..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?