In an era where India’s tour and travel industry is rapidly expanding, chartered accountant and financial educator CA Nitin Kaushik has highlighted an often-overlooked factor that can make or break a budding travel business: GST registration.
In a detailed thread on X (formerly Twitter), Kaushik explained that while entrepreneurs focus on clients, bookings, and branding, it is actually GST registration that “quietly decides your fate even before you print your visiting card.”
Compliance to credibility
Kaushik argued that GST registration is not just a tax formality but a business asset that elevates a side hustle into a recognised venture. Whether one is running tours, renting cars, or handling travel bookings, he noted that GST registration gives the business legitimacy, enabling access to formal contracts, corporate tie-ups, and smoother banking processes.
The mandatory threshold remains unchanged — turnover above ₹20 lakh, or ₹10 lakh in select states, calls for compulsory registration. But Kaushik emphasized the strategic value of voluntary GST registration, even for those below the limit. “It lets you claim input tax credit and boosts client trust,” he wrote, adding that in today’s competitive landscape, “paperwork speaks before your proposal does.”
According to Kaushik, the registration process — generating a temporary reference number, submitting business details, uploading documents, and OTP verification — is simpler than most entrepreneurs assume. What these steps create, however, is “a formal business identity under India’s tax network,” which unlocks long-term structural benefits.
Why travel operators should opt for regular GST
Kaushik stressed that travel businesses should register under Regular GST, not the Composition Scheme, as the latter restricts input tax credits. For operators who incur significant backend costs, the ability to claim credits directly impacts profitability and allows more competitive pricing.
He also pointed to the importance of correct service classification, noting that most tour and travel operators fall under SAC 998555 — Reservation services for transport. Accurate coding ensures aligned invoicing, accounting, and compliance.
Beyond operational advantages, Kaushik underscored the reputational impact of GST registration. Banks treat registered entities differently, clients perceive them as more credible, and opportunities for scaling open up.
“GST isn’t just tax compliance — it’s your brand’s reputation certificate,” he concluded. “In the long run, it tells customers and partners you’re not just another operator. You’re a registered, recognized business.”
