Hotels and Lodging Rentals Subject to 60% Service Tax Rate Under Section 66B Since July 1, 2012

Renting of hotels, inns, guest houses, clubs, campsites, or other commercial places for residential or lodging purposes is subject to a service tax effective from July 1, 2012. The effective tax rate is 60% of the prescribed service tax under section 66B, provided that no CENVAT credit on inputs and capital goods used for the taxable service is claimed under the CENVAT Credit Rules, 2004. "Renting" is defined as allowing access, use, or occupation of an immovable property, with or without transferring possession or control, including letting, leasing, or licensing arrangements.

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