The Central Board of Excise and Customs on Sunday clarified that restaurants with air conditioners anywhere at the facility will charge a Goods and Services Tax rate of 18 percent on food bills.
“A uniform GST rate of 18 per cent will be charged on takeaways as well as food served from a non-AC area of a hotel or restaurant if any of its part has a facility of air conditioning,” the government agency has said.
The new Goods and Services Tax (GST) regime, which was rolled out from 1 July, provides for levy of 12 percent on food bill in completely non-AC restaurants. The tax rate for AC restaurants and those with liquor licence will be 18 percent while 5-star hotels will charge 28 percent GST. Restaurants that have separate AC and non-AC areas will charge a uniform GST rate of 18 percent, regardless of where the food is served and even on takeaway orders.
The Central Board of Excise and Customs (CBEC) has clarified through an FAQ on the GST rates that will be levied by restaurant-cum-bars where the first floor area is air-conditioned and used for serving food and liquor while the ground floor only serves food and non-AC.
The CBEC said tax will have to be charged irrespective of from where the supply is made, first floor or second floor.
If these restaurants are also supplying liquor, then they are not even eligible for the composition scheme.