GST on Train Tickets in India

GST rates on train tickets are important for everyone using trains in India. Different travel classes have different GST rates, based on the comfort and amenities they offer. Travellers should know about these charges since they impact the total cost of their trip.
 
 

When planning a train trip, the cost is just as important as the destination or the train you choose. Changes in economic policies and GST (Goods and Services Tax) rates can affect how much you pay for train tickets. Let's find out how GST influences train ticket prices in India, helping you understand your travel expenses better.

Everything You Need to Know About GST on Train Tickets in India

Understanding the GST rate on train tickets can help you manage your travel budget more effectively. Let's get started on unravelling the cost behind your train journey.

Overview of GST and Its Application to Train Tickets

In 2017, India introduced the Goods and Services Tax (GST), which combined numerous indirect taxes into one. This change simplified the tax system for railway transportation. Previously, services and goods were taxed separately under different laws, but now, GST covers train tickets based on travel class and type. 

Breakdown of GST Rates for Different Classes of Train Tickets

So, how much GST on train tickets? GST rates on train tickets vary significantly based on the travel class and services offered. Here's a concise breakdown:

Sleeper Class and Second Class Seating

Exempt from GST, these tickets are aimed at economically weaker sections, thus promoting affordability.

AC Chair Car, AC 3-tier, First Class, and Executive Class

Charged at 5% with the benefit of input tax credit (ITC) for goods and services used in supplying the service.

Premium Services Like Luxury Trains (such as Palace on Wheels, Maharajas' Express)

Levied at a GST rate of 5%> However, a GST rate of 18% is levied on addon services during the journey, reflecting the premium service and amenities provided.

Understanding these distinctions is crucial for passengers planning their travel budgets.

GST on Tatkal Railway Tickets

When you book a Tatkal railway ticket, you are subject to a GST of 5%. This rate is the same regardless of the class of travel, whether it's sleeper, AC, or otherwise. For example, if your Tatkal ticket costs ₹1,000, the GST would be ₹50, making your total ticket price ₹1,050.

GST on Train Ticket Cancellation

If you decide to cancel your train ticket, there's more to consider than just the cancellation fee. GST is also recalculated based on the cancellation. For instance, if you cancel an AC Chair Car, AC 3-tier, First Class, or Executive Class ticket, the 5% GST is adjusted. You're refunded the ticket price minus the cancellation charges and the applicable GST on those charges. Luxury train tickets follow the same pattern, with 18% GST recalculated and adjusted accordingly. 

Always check the specific cancellation policy when booking your ticket. This policy outlines the exact deductions applicable, including the recalculated railway ticket GST rate. Knowing these details can prevent last-minute surprises and help you better manage your travel expenses.

Previous and Current GST Rate and Its Effect on Consumers

The GST on train tickets has changed several times since it started. At first, the Indian government set a rate that raised ticket prices, especially for premium and air-conditioned classes. This upset middle and upper-middle-class commuters who depend on these services. After listening to the public, the government lowered the GST rates, which helped bring down AC class ticket prices and made them more affordable again.

As of now, the GST rates have been relatively stable. The current system aims to strike a balance by keeping costs low for lower classes and taxing higher classes moderately. This helps subsidize tickets for the impoverished, while also promoting public transport and reducing the carbon footprint. For regular rail users, stable tax rates mean more predictable travel costs, making it easier to plan finances.

 

Knowing the latest updates on train travel costs can help you budget your trips more effectively. As the government continues to revisit GST on railway ticket rates, staying informed ensures you always understand how travel prices are set. This awareness aids in managing your money better and planning your trips wisely.

Frequently Asked Questions

 

Q1. Can we claim GST input on train ticket?

Ans. Claiming GST input credit on train tickets depends on specific circumstances. Only businesses registered for GST in India can claim GST on train tickets credit, and the travel expense must be business-related.

Q2. What is the GST rate of IRCTC convenience fee?

Ans. When booking a train ticket through IRCTC's website or app, a convenience fee is charged. This fee helps maintain the online booking platform. The GST rate applied to this convenience fee is 18%. The total will include this, along with the normal GST on train tickets.

Q3. Are there GST on train tickets for children?

Ans. Yes, GST is applicable on train tickets for children if they are travelling in AC class or first class. It remains the same as that of normal tickets.

Q4. How do I claim GST on my railway ticket?

Ans. Only business travellers can claim GST credit on train tickets. Ensure your ticket includes your GSTIN. When booking online, enter your company's GSTIN to get a tax invoice. Save all railway receipts and invoices for filing GST credits. Additionally, include relevant details, such as invoice numbers, in your GST return.

Related Blogs:

• •  GST Bill In India: A Complete Guide For Business Travellers!
• •  GST Registration: A Step by Step Guide For Small Businesses
• •  GST on Flight Tickets: How to Get Input Tax Credit on Flights
• •  GST on Hotel Rooms: How to Get Input Tax Credit on Hotels
• •  Business Travel: Its Significance & Impact on Your Bottom Line
• • 9 Key Features of Top-Notch Travel Management Systems