We have changed the way we carry out business transactions by way of GST implementation. It was launched with the primary intention to reduce all the indirect taxes into one single tax structure. The best part is, it has helped the corporates save on their business expenses through the process of claiming their input tax credit (ITC) thereby, reduce the tax paid on sales of goods or services from the tax already paid on the purchase.
Companies with business travel desk have to submit GST compliant invoices to avail the input tax credit benefits. It is essential that they have GST compliant invoices from the airline as well as the travel solution provider in order to reconcile for claiming the input tax credit.
Impact of GST on flight fare
Domestic air travel in economy class is going to fly high post-GST with air travel costs decreasing.
On the other side, the business class charges will cost higher, with a minimal increment in tax from 8.4% to 12%. Largely, this shouldn’t deflect business travelers from their travel plans.
A major part of the revenue generated by airlines comes from economy class bookings as this segment offers a higher amount of seats. Besides, airlines can only claim input tax credit (ITC) on input services for the economy class, while in case of business class they can claim ITC for spare parts, food items and other inputs excluding cost on aviation fuel turbine (ATF) as it falls under the purview of GST.
Automated GST Reconciliation by TrackMyTkt
In addition to tracking of already booked flight tickets to find viable price drops, TrackMyTkt helps you reconcile the GST from flight tickets with the respective airline invoices using the GST Reconciliation tool. TrackMyTkt automatically downloads invoices from the airlines and reconciles the GST amounts with flight tickets. You can very clearly see either the amounts matching or not matching without even clicking a button. This will significantly reduce the travel and finance teams’ effort and helps you to save money by being prompt with the GST filings.
What remains to be seen is if the airlines will be willing to pass on the benefits of the reduced tax rates to customers going forward or not.
