Ever since the Goods and Services Tax (GST) was implemented on July 1 across the country, it has affected the customers directly. The new tax regime is considered as one of the biggest economic reforms since India’s Independence but its complex nature has left many people and traders confused. Just like other goods, the GST also had an impact on your restaurant bills making dining at luxurious places slightly expensive. What remained unclear, however, was that how much tax will be levied on takeaways.
In a tweet, the Central Board of Excise and Customs (CBEC) answered many FAQs on GST on Saturday evening including the tax that will be imposed on takeaways as well as food served from a non-AC area of a hotel or restaurant. As per the tweet, the customers will have to pay a uniform GST rate of 18 per cent on all the takeaways from the non-AC area of the restaurant if a part of the facility has air conditioning. For example, if you have taken the food from the ground floor of an outlet which doesn’t have AC, you will still have to pay 18% tax if the third floor of the same outlet has an AC restaurant.
— CBEC (@CBEC_India) August 12, 2017
The CBEC said the tax will have to be charged at 18 per cent irrespective of from where the supply is made, first floor or second floor. “If any part of the establishment has a facility of air conditioning, then the rate will be 18 per cent for all supplies from the restaurant,” it said while answering the FAQ.
Coming to the tax rates that would be charged for take-away food from such restaurants, the CBEC said, “Tax has to be charged at 18 per cent on supplies of food made from their takeaway counter.” If these restaurants are also supplying liquor, then they are not even eligible for the composition scheme.
After the implementation of the new regime, if you are eating in a Non-AC restaurant, you have to pay 12% as tax. It is made of Central GST (6%) and State GST (6%). The same rates also apply for local delivery restaurants. However, if you are in an AC restaurant, you will have to pay 18% tax irrespective of the fact that it serves alcohol or not.