Quick answer
Most Indian tour operators charge 5% GST on the full value of a holiday package, domestic or international, without claiming input tax credit; a few charge 18% with credit, mainly for corporate clients. Overseas packages also attract 2% TCS, which you get back through your ITR. GST is not refundable to individual travellers, so always compare quotes inclusive of GST.
Key takeaways
- Tour packages usually carry 5% GST on the total price, for both domestic and international trips.
- GST is a real cost for individuals; TCS on overseas packages is not, because you claim it in your ITR.
- Booking components separately changes the tax: Indian hotels and flights have their own GST rates.
- A proper invoice shows the operator's GSTIN, the GST line and, on overseas packages, TCS as a separate line.
How does GST apply to a tour package?
When an Indian tour operator sells you a package that bundles transport, hotels and sightseeing, GST treats it as a tour operator service. Operators can bill it in one of two ways:
| Option | GST rate | Input tax credit for the operator |
|---|---|---|
| Tour operator rate | 5% of the full package value | Not allowed, except on tour services bought from other operators |
| Standard rate | 18% | Allowed |
Almost every leisure package is billed at 5%. The operator's big costs on a holiday, such as foreign hotels and coaches, carry no Indian GST to claim back, so the lower rate without credit works out better for everyone. The 18% option mainly suits corporate travel where the client company can use the credit.
Does GST apply to international packages too?
Yes. When an Indian company sells a package to a customer in India, GST applies even if the whole trip happens abroad. A ₹3 lakh Europe package from an Indian operator carries GST in the same way as a ₹50,000 Kerala package.
What differs is TCS. Since 1 April 2026, overseas packages also attract 2% TCS from the first rupee; domestic packages don't. TCS is advance income tax that you claim back, explained in TCS on foreign tour packages.
If you book directly with a foreign hotel or tour company, Indian GST doesn't apply, but local taxes do: VAT and the Tourism Dirham in Dubai, city taxes in Europe, and tax and service on Bali hotel bills.
Worked example: domestic vs international
| Kerala, 5 nights, family of 4 | Bali, 6 nights with flights, couple | |
|---|---|---|
| Package price | ₹96,000 | ₹1,80,000 |
| GST at 5% | ₹4,800 | ₹9,000 |
| TCS at 2% | Not applicable | about ₹3,780, on the GST-inclusive total |
| Total payable | ₹1,00,800 | about ₹1,92,780 |
| Recoverable through ITR | Nil | about ₹3,780 |
The GST is a cost in both cases. The TCS on the Bali trip is not; it returns when the couple files their returns. The Bali trip cost guide breaks down what goes into the package price.
What if you book flights and hotels separately?
Each component then carries its own GST, and the rates differ:
| Component | GST at the time of review |
|---|---|
| Hotel room in India, up to ₹7,500 a night | 5%, without input tax credit for the hotel |
| Hotel room in India, above ₹7,500 a night | 18% |
| Economy class air ticket | 5% |
| Business and first class air ticket | 18% |
| Online travel agent's convenience or service fee | 18% |
| Buying foreign currency | 0.18% of the value up to ₹1 lakh, minimum ₹45 |
These reflect the GST rate changes that took effect in September 2025. For domestic trips with hotels above ₹7,500 a night, a package at 5% on the total can work out lower than the sum of separately booked parts. For budget hotels, the difference is small.
What should a proper GST invoice show?
- The operator's legal name, address and GSTIN
- Your name, and your company's GSTIN if it's business travel
- Invoice number and date
- The service description, usually tour operator services
- Taxable value, GST rate and amount, shown as CGST and SGST within the same state, or IGST across states
- For overseas packages, TCS on a separate line, not mixed into GST
You can check any GSTIN on the GST portal using its taxpayer search. An operator that can't give you a GST invoice is a red flag, and without one you'll struggle with a travel insurance cancellation claim, which needs proper invoices.
When comparing quotes, ask each operator for one all-inclusive figure covering GST and TCS. A quote of ₹1,45,000 plus GST becomes ₹1,52,250 once tax is added, which is more than a ₹1,50,000 quote that already includes it.
Is GST charged on cancellation charges?
Generally yes. When an operator keeps part of your payment as a cancellation charge, GST applies to the amount retained, at the same rate as the original service. The refund of the balance should include the GST you paid on that portion, usually through a credit note. Ask for the revised invoice when you cancel.
Can you claim the GST back?
Individuals on holiday cannot. A business can claim input tax credit only on genuine business travel, such as a conference or a client visit, when the operator bills at the rate that allows credit and the company's GSTIN is on the invoice. Holidays given to employees, including incentive trips, are generally blocked from input tax credit under GST law.
What are the common GST mistakes?
- Comparing a "plus GST" quote with an inclusive one. On a ₹4 lakh Europe tour, the difference is ₹20,000.
- Treating TCS and GST as the same thing. GST is gone once paid; TCS comes back. Our GST on tour packages glossary entry sets them side by side.
- Paying part of the price in cash without a bill. You lose consumer protection and weaken any insurance or refund claim.
- Forgetting taxes paid abroad. City taxes in Europe, the Tourism Dirham in Dubai and resort fees are often excluded from the package and paid at the hotel.
How does GST compare with taxes abroad?
Indian travellers sometimes assume a foreign hotel booked directly is cheaper because there's no GST. It isn't automatically. Dubai hotel bills carry VAT, a municipality fee and a service charge; Bali hotels add tax and service of about 15–21%; and Paris, Rome and Amsterdam charge nightly city taxes on top. Compare total prices, not headline rates.
Frequently asked questions
What is the GST rate on tour packages in India?
Is GST charged on international tour packages?
Can I claim GST paid on a holiday package?
Is TCS calculated on the GST amount too?
What GST applies to hotel bookings in India?
How can I check if a tour operator's GST number is genuine?
How we checked this page
Last reviewed
Written and fact-checked by the Elitech Travels editorial desk in New Delhi, drawing on our consultants' day-to-day booking work and the official sources below. Rules, fares and fees change — always confirm anything critical with the issuing authority before you travel. Our editorial policy.
