Industry survey highlights strong support for a 5% GST rate without ITC, with operators expecting lower ticket prices, higher footfalls and fresh investments
New Delhi, September 2026 : For families looking to spend a weekend at an amusement
park, water park or indoor entertainment centre, ticket prices are often an
important part of the decision. For the businesses operating these attractions,
however, the equation is more complex. High operating costs, significant
investments in infrastructure and changing consumer spending patterns continue
to put pressure on the industry.
Against this backdrop, the Indian Association of
Amusement Parks and Industries (IAAPI) is calling for a more rational GST
structure for the amusement industry. The association believes that bringing
down the GST burden can help make entertainment more affordable for consumers
while giving businesses greater room to invest, expand and create employment.
IAAPI’s Research & Analysis Committee recently
conducted its member survey, receiving overwhelming response from industry
operators from across the country. The findings offer a clear picture of how
the industry views the current tax structure. 84% of operators described the
existing 18% GST rate as high, while 62.3% said they would prefer a flat 5% GST
rate without Input Tax Credit (ITC).
Importantly, the industry says the benefit would not
necessarily stop businesses. Nearly 69% of operators said they would reduce
ticket prices if GST were brought down to 5% without ITC. This could make visits
to amusement and recreational attractions more affordable for families and
encourage more people to spend on leisure and entertainment.
Ankur Maheshwary, Chairman, IAAPI, said, “The amusement industry is ultimately about
creating experiences for people and bringing families together. But for many
operators, particularly smaller and mid-sized businesses, the current GST
structure adds to the pressure on an already capital-intensive business. A more
rational rate can create a win-win situation — consumers can benefit through
more affordable tickets, while operators can focus on improving their
facilities, creating new experiences and expanding their businesses.”
Notably, overwhelming majority (approx. 80%) of the
visitors to amusement parks belong to middle and lower-middle-class households,
the very demographic that the GST 2.0 reforms sought to protect. Present GST
rate adversely impacts footfall, muting customer demand.
Amusement parks are an integral part of the tourism
industry and contribute significantly to the growth of tourism, employment,
local businesses, and the overall economy. However, the sector is treated
unequally compared with other important components of the tourism industry,
such as hotels and airlines. Hotel accommodation with room rent up to ₹7,500 is
subject to 5% GST, while economy-class airfare is also generally taxed at 5%
GST. In contrast, amusement park tickets, which typically range from ₹500 to
₹1,800 during peak seasons, are subject to 18% GST. This substantial difference
in taxation places an additional burden on the amusement park industry and
makes it comparatively less competitive. Since amusement parks form an
important part of the tourism and entertainment ecosystem, there is a strong
case for rationalising the GST rate applicable to amusement park entry tickets
and bringing it at par with other tourism-related services.
The survey also highlights why the current ITC mechanism
does not provide equal benefit to all operators. Around 63.6% of operators
said they currently offset less than 25% of their GST liability through ITC.
At the same time, 61% of operator respondents reported turnover below Rs 25
crore, indicating that smaller and mid-sized businesses form a significant
part of the industry.
The expected impact goes beyond ticket prices. 64.9%
of operators identified increased customer demand as a key benefit of a 5% GST
rate, while 62.3% expect facility expansion, 61% anticipate revenue growth and
54.5% see the possibility of new investments in projects.
What stands out from the survey is that the industry is
not looking at GST rationalization simply as a way to improve margins.
Operators are looking at it as an opportunity to attract more customers,
reinvest in their facilities and build a stronger amusement ecosystem.”
IAAPI
believes that a simpler and more rational GST structure can support the
industry's growth while making leisure and entertainment more accessible to
consumers. The association will continue to engage with policymakers and
stakeholders, using industry data and member feedback to make a constructive
case for GST reform.