GST 2.0 & Tourism: What Travel Agents, Airlines & Planners Must Know

Published on September 23, 2025

Overview

On 22 September 2025, India implemented GST 2.0, a sweeping reform of its Goods & Services Tax structure. The government has consolidated GST slabs and reduced rates across key sectors—including hotels, transport, and cultural goods—to make travel and tourism more accessible, boost domestic demand, and support traditional artisans.

For stakeholders across the B2B travel ecosystem—corporate travel managers, airline professionals, travel agents, and tour consolidators—these changes present new opportunities and strategic implications.

What’s Changed: Key Reforms

1. Hotels & Accommodation

Rooms under ₹7,500/night now attract 5% GST (without input tax credit, or ITC), reduced from 12% with ITC.
Rooms below ₹1,000/night remain GST-free (i.e. 0%)—this slab was already exempt and continues so.
Travellers booking rooms under ₹7,500 will save up to ₹525 per room per night, roughly 7% on room rates.

Implications for B2B partners: Mid-range and budget hotels become more competitive. Expect increased demand in Tier-2 and Tier-3 cities. Corporate stays and group travel packages can leverage more attractive pricing.

2. Transportation: Buses & Public Travel

For travel agents and tour operators, costs for including coach or bus transport in itineraries may decline—opening door for more competitive packages. Airlines or consolidators offering multi-modal travel (fly + coach) might seize an advantage.

3. Cultural & Artisan Goods

Impacts & Opportunities for the B2B Travel Sector

Travel Agents & Tour Consolidators

Corporate Travel Planners

Airlines & Intermodal Operators

Hotels (Mid/Budget Segment)

What to Watch For / Challenges

Conclusion & Takeaways

India’s GST 2.0 reforms mark a turning point for tourism and travel-related industries. For B2B players—travel agents, consolidators, corporate planners, and airlines—they open up significant opportunities:

To harness these advantages, stakeholders must adapt quickly: update pricing models, renegotiate with suppliers, promote savings to clients, and ensure compliance with the new tax slabs. The early movers will likely capture a bigger share as travel demand adjusts.

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