Question ID :
Dear Sir / Ma'am
I had the following query with respect to GST on Air Ticket Agents. Would be highly obliged if the same is answered.
Air Travel Agent - Quota/Series Purchase of tickets from Airlines
Facts : Travel Agent is purchasing Air tickets from Airlines in advance in Bulk (Quota / Series Purchase). E.g. They purchased a ticket (PNR) from the Airline for Rs 3500 one month ago, now at the time of sale to customer they add their markup of say Rs. 500 and sell it to customer. At times they may sell it cost to cost or at lower than their purchase price (at loss) depending upon the demand in the market. The risk & reward is entirely of the Agent. In this case while purchasing the tickets from the Airline, Air travel Agent is giving his GSTIN and the invoice is raised by Airline in name of Air Travel Agent.
1. For Quota Purchase tickets, can the travel agent claim ITC and them further pass it on to actual customer for Airline GST. For markup, 18% GST is being charged and paid accordingly.
2. If the Travel Agent is not eligible to claim ITC on the airline GST. Is he required to deposit GST only on the markup charged to the customers?. Also, what would be the value of the taxable turnover for the purpose of GST. Can the entire basic cost of ticket be reported as exempt supply?
SUHAIL AHMAD MIR
Jul 04, 2022