Govt mulls GST relief package for aviation and hospitality sectors


The government mulls to provide a GST relief package to the worst-hit sectors like restaurants, aviation, hospitality and realty sectors that help to mitigate the impact of coronavirus outbreak.

The package may consist of a six-month suspension of GST payments for those sectors who suffered the most due to this pandemic, according to a report by The Economic Times.

Another proposal considered by the government is to adopt a cash-based system for levying the tax in lieu of the current system based on invoices.

A cash-based system implies that businesses would pay GST to the government when they received the cash in hand not when the invoice is raised.


“These measures are expected to ease the liquidity pressure on businesses that are strapped for cash,” said the people who are aware of the matter to ET.

The GST Council, an apex decision-making body for the tax, will be given a final nod on this proposal.

“There is a thinking that for these service sectors, the government should at least spare its dues,” a government official told ET.

The government may also plan to exempt the other statutory charges on a temporary basis for the worst affected sectors.


One of the government officials told ET, “Though there has been a demand for complete GST exemption, the government is veering around to the view that suspending the tax will work better.”

Suspension of GST for six months will be a good move that provides benefits to the companies to scale up their businesses and cope up with the unprecedented crises.

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