GST on Passenger Transport Services
What is meant by passenger transport services under GST?
Passenger transport services refer to services provided for the transportation of passengers by various means i.e. rail, air, road, water or ropeway, cable car, etc.
What is the GST rate for the transport of passengers by rail?
Transport of passengers, with or without accompanying belongings, by rail in first class or air-conditioned coach attracts 5% GST without ITC.
However, for service of transportation of passengers by railways in a class other than first class or an air-conditioned coach is exempt under GST. Also, transportation of passengers by metro, monorail, or tramway is exempt under GST.
What is the GST rate for the transport of passengers by air?
Transport of passengers, with or without accompanied belongings, by air in economy class attracts 5% GST without ITC. However, Transport of passengers by air other than economy class attracts 12% GST with ITC.
What is the GST rate for the transport of passengers by road?
Services of passenger transportation by road attract 5% GST without ITC by the following modes:
(a) air-conditioned contract carriage other than a motor cab
(b) air-conditioned stage carriage
© radio taxi
Note:
- “Contract carriage”, as defined in 2(7) of the Motor Vehicles Act, 1988, means a motor vehicle that carries a passenger or passengers for hire or reward and is engaged under a contract, whether expressed or implied, for the use of such vehicle as a whole for the carriage of passengers mentioned therein and entered into by a person with a holder of a permit about such vehicle or any person authorized by him in this behalf on a fixed or an agreed rate or sum —
(a) on a time basis, whether or not concerning any route or distance; or
(b) from one point to another, and in either case, without stopping to pick up or set down passengers not included in the contract anywhere during the journey, and includes —
(i) a taxicab; and
(ii) a motor cab notwithstanding that separate fares are charged for its passengers.
- “Stage carriage”, as defined in section 2(40) of the Motor Vehicles Act, 1988, means a motor vehicle constructed or adapted to carry more than six passengers excluding the driver for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey.
- “Radio taxi” means a taxi including a radio cab, by whatever name called, which is in two-way radio communication with a central control office and is enabled for tracking using a Global Positioning System (GPS) or General Packet Radio Service (GPRS).
However, transport of passengers, with or without accompanied belongings, by the following modes is exempt under GST:
- Non-airconditioned contract carriage other than radio taxi, for transportation of passengers, excluding tourism, conducted tour, charter, or hire; or
- Stage carriage other than air-conditioned stage carriage.
Provided that nothing contained above shall apply to services supplied through an electronic commerce operator, and notified under sub-section (5) of Section 5 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017).
What are the HSN codes for passenger transport services?
Conclusion
In conclusion, GST rates for passenger transport services vary based on the mode of transportation and class. Whether it’s rail, air, road, or water, different rates apply, ranging from 5% to 18% with or without Input Tax Credit (ITC). Businesses and consumers alike need to understand these rates to ensure compliance and proper budgeting.
