When the government announced that salon and wellness services would now come under a 5% GST rate, it immediately sparked conversations across the beauty industry. For most people, it looked like just another tax reform. But if you’ve been in this space long enough — working with salon chains, franchisees, or even independent stylists — you know this move has the power to reshape the way the industry grows in the next few years.
At Innosmarti, we work closely with some of India’s leading salon brands, and here’s our honest view: this isn’t just about cheaper bills. It’s about accessibility, scale, and how beauty becomes a more regular part of everyday life.
What it Means for Customers
For customers, especially those who search daily for “salon near me”, “best beauty parlour in [city]”, or “affordable spa services”, the GST cut means:
- More economical grooming: Reduced costs for regular services such as haircuts, facials, and pedicures.
- Access to luxury services: Keratin treatments, coloring, and sophisticated skincare are now more affordable.
- Encouragement for repeat visits: As costs fall, beauty becomes a lifelong habit rather than an occasional luxury.
- This naturally enhances customer loyalty and visit frequency, thereby impacting salon revenue.
Why Salon Owners Should Pay Attention
Running a salon is tough. Rent, staff training, product costs — they add up fast. When GST drops to 5%, it doesn’t magically fix everything, but it does create breathing room. And that’s where the opportunity lies.
From our perspective at Innosmarti, here’s how owners can turn this into an advantage:
- More walk-ins, better loyalty
Lower prices don’t just attract first-timers; they also make people come back more often. Consistency is where real growth happens. - Franchise models look stronger
Brands like Green Trends, Toni and guy, Naturals, Page 3, and Lakmé thrive on franchising. With reduced tax pressure, new investors are more likely to take the leap, especially in Tier 2 and Tier 3 cities. - Room to innovate
Whether it’s introducing a new service package or offering seasonal deals, salons can experiment without eating into margins. - Tier 2 & Tier 3 advantage
In smaller cities like Coimbatore, Trichy, or Madurai, a few hundred rupees matter. This cut makes salons in these markets far more competitive.
Where Digital Meets GST: Innosmarti’s Take
Now, let’s be honest — a lower GST rate by itself doesn’t bring more people through your door. Customers don’t wake up and say, “Oh, GST is only 5% now, let me book a haircut.” What actually makes the difference is how salons talk about it, both online and offline.
That’s where digital comes in, and this is something we see every day at Innosmarti. When a salon updates its Google profile with simple lines like “Now at 5% GST – More affordable services”, people notice. When an ad on Instagram says “Hair spa just got cheaper in Chennai”, the clicks follow. And when you build a small automation to remind clients about offers on WhatsApp, that one little nudge can turn into repeat business.
So yes, the tax cut is great — but the salons that shout about it smartly will be the ones to really win.
Looking Ahead
India’s salon and wellness sector was already one of the fastest-growing lifestyle industries. The GST cut is simply fuel on the fire. It makes beauty more accessible to the everyday customer and gives business owners the confidence to expand.
At Innosmarti, our belief is simple: this is the right time to double down on digital. Because when a customer searches “best salon in Chennai” or “bridal makeup in Coimbatore”, it won’t just be the price they notice — it’ll be the salons that look professional, visible, and approachable online.
