GST, rush to buy tickets push up first-class revenue

On July 1, the prices of first-class and season (passes) tickets increased after GST replaced service tax, which was until then being levied on the base fare.

Written by Neha Kulkarni | Mumbai | Published:July 11, 2017 4:00 am
GST, GST Mumbai Local, Goods and Services Tax (GST) , Mumbai Local, Mumbai News, Indian Express News The total earnings for both Central Railway (CR) and Western Railway (WR) in first-class have increased by 8 per cent to Rs 45.81 crore in June compared to Rs 42.33 crore in May.

The suburban railways’ first-class passenger earnings increased by 8 per cent in June over May, a spike officials attributed to the rush of commuters to buy quarterly, half-yearly and yearly season tickets ahead of the fare hike following introduction of the Goods and Services Tax (GST) on July 1. On July 1, the prices of first-class and season (passes) tickets increased after GST replaced service tax, which was until then being levied on the base fare.

Under GST, the tax increased by 5 per cent or more against the 4.5 per cent service tax levied earlier. Consequently, ticket prices have increased by Rs 10-20. The total earnings for both Central Railway (CR) and Western Railway (WR) in first-class have increased by 8 per cent to Rs 45.81 crore in June compared to Rs 42.33 crore in May. Similarly, there was a 3.23 per cent rise in passengers travelling in first-class between May and June, data shows. “It’s not necessary that earnings or passenger volume increase every month. It depends on various factors, which include reopening of schools and colleges, festivals, among others. In this case, the rise was due to GST. A specific increase in sales of tickets for first-class was noticed in the last 10 days of June,” said a senior railway official.

For WR, passenger earnings rose by 14 per cent to Rs 45.81 crore in June compared to Rs 42.33 crore in May, riding on more half-yearly and full-yearly season ticket sales. “Passengers with season tickets about to expire by mid- or end-July probably were quick to book the next set before the fare rise, which though has been marginal,” the official said. “I did book my half-yearly season ticket before June-end as I feared GST could push up the cost. I wanted to save up on money,” said Jiten Shah, a commuter travelling to Chhatrapati Shivaji Terminus from Thane. “I had bought my half-yearly season ticket in March. I did not worry about the rise as I knew it would not be much,” said Satyen Mehta, another commuter who travels in the local trains.

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