How GST on Airline Tickets Affects Your Travel Budget

If you are a frequent traveler, you may have noticed an increase in the prices of airline tickets. One of the factors responsible for this could be the Goods and Services Tax (GST). In this article, we will explore how GST on airline tickets affects your travel budget and what you can do to mitigate its impact.

What is GST?

Goods and Services Tax (GST) is a tax imposed on the supply of goods and services. It is a single indirect tax that aims to streamline the taxation system in India. GST replaced multiple taxes, such as central excise duty, service tax, value-added tax (VAT), and so on. GST has four tax slabs, namely 5%, 12%, 18%, and 28%.

How Does GST Affect Airline Tickets?

Before the implementation of GST, airlines were exempted from paying many taxes, such as excise duty, value-added tax, and service tax. However, after the implementation of GST, airlines are required to pay taxes on the inputs they use, such as fuel and services, which results in an increase in the cost of operations. To compensate for this, airlines pass on these costs to the passengers, resulting in an increase in airfare.

How Much GST is Charged on Airline Tickets?

The amount of GST charged on airline tickets varies depending on the class of travel. Economy class tickets attract a GST of 5%, whereas business and first-class tickets attract a GST of 12%. Additionally, airport charges, such as passenger service fee, user development fee, and airport development fee, also attract a GST of 18%.

How Can You Mitigate the Impact of GST on Airline Tickets?

While there is no way to avoid paying GST on airline tickets, there are some ways to reduce the impact it has on your travel budget. One way is to book your tickets well in advance, as airlines tend to offer lower fares for early bookings. Another way is to travel during off-peak seasons, as airlines offer lower fares during these times. Additionally, you can check for airline promotions and discounts that can help reduce the cost of your ticket.

Conclusion

GST has had a significant impact on the cost of airline tickets, and it is important for travelers to be aware of this. By taking the necessary steps, such as booking in advance, traveling during off-peak seasons, and checking for promotions and discounts, you can reduce the impact of GST on your travel budget. It is also essential to keep track of your expenses and plan your budget accordingly to ensure that you have a hassle-free travel experience.