Goods and service tax is applicable across the nation with simplified rules and regulations. But in case, if you are still doubts and are not sure about the generation of bills in a restaurant, you must be prepared to understand the changes included in the bill provided by the restaurants.
Latest Update
03rd January 2023
- The Chhattisgarh GST AAR has shared the order for the M/s Gangaur Sweets. The applicant will be required to pay GST at 5% [2.5% CGST + 25% SGST] for the supply and sale of sweets, namkeens, cold drinks, and other edible items through its restaurant. This will also apply to all sales from such restaurants and no input tax credit will be available. Read Order
In case if you are overcharged in such kind of situations, you must be aware of and understand the exact calculation of GST bills of restaurants. First of all, to understand the bills, there must be an understanding of the components of the bill.
- Service Charge – The service charge is not a legally bound tax implication over the customer, and therefore he cannot be compulsorily charged with the service charge. A customer can anytime refer to the consumer court for such kind of charges.
- GST – Normally charged at a rate of 5% or 18% of the total cost of the bill.
Changes After 23rd GST Council Meeting in Restaurants
Just after the GST council 23rd meeting, the announcement was made for relaxation in the GST rate of all the AC and Non-ac restaurants. Earlier, there was 12 percent GST on non-AC restaurants and 18 percent on AC restaurants which has been reduced to 5 percent, making the services cost-effective for everyone. However, there is one condition to this rule.
Here it is.
If you are eating out in a restaurant that doesn’t offer services of a hotel or guest house, you will be legally paying 5% GST on your purchases. However, if you are eating in a restaurant which is located in the premise of a hotel guest house, inn or any other lodging based commercial place with a daily tariff of Rs 7,500 or more per unit (room), then you will be liable to pay 18% GST, even if you are just using the restaurant services and not checking into the hotel.
The general public assumed that the food prices will get to see a reduction after the changes in tax rates but still the matter remain worse. In a recent case of the price hike, it was seen in most of the nationalized food chains which preferred an alternate way to tackle the tax rate reduction. As the tax rate was reduced, the food chains surged the price of these items individually, taking the tax instance same as it was earlier.
This change was felt in various parts of the country and was reportedly revealed in various social media websites. It is very problematic to see the adamant path taken by the food industry to continuously charge the higher price from the customer despite tax reduction at a mass level.
In some recent scenario, there are some faults in the bill generated in the restaurants which must be understood by a responsible consumer.
The bill depicts a service charge of 10% which is not in the laws of taxes and is a free concern of the customer to pay it or not. However, an extra CGST and SGST is also charged with the service charge at 9% each, which is completely illegal and unauthorized. The customer can move to consumer court in this case.
Now, the accurately taxed bill shows, which is only deducting the authorized charges drafted in the rules of GST tax. The restaurant deducts a 9% CGST and 9% SGST from the bill cost with no other subsumed charges.
Read Also: Meaning of IGST, CGST and SGST with Input Tax Credit Adjustment
After the implementation of goods and services tax in India, all the aforementioned taxes are now subsumed into the one GST. The Government also mentioned the tax levy from different restaurant categories:
- Non AC restaurants – 5% GST (CGST 2.5% + SGST 2.5%)
- AC restaurants – 5% GST
- Restaurant (AC or non-AC) located in hotel premise with Rs 7,500 or more daily tariff – 18%
- While pre-packed and pre-cooked food from restaurants – 12%
- Composition Scheme Restaurants – No Tax Applicable to Customers
Note: How to check if a trader is registered under GST or not by the simple online official portal. Check here: https://services.gst.gov.in/services/searchtp. You can also see the status of trader whether the organization is registered as regular or composition.
Where to file the complaint, if the trader does GST fraud?
- Email: helpdesk@gst.gov.in
- Phone: 0120-4888999 , 011-23370115
- Twitter: @askGST_Goi, @FinMinIndia
So, therefore there is no highest slab of GST rate on the restaurants and it cannot charge 28% from its customers. The government department also keeping an eye on rates of food in the restaurants and has demanded the eateries to cut rate on the food supplied in order to set off the tax paid inputs and showing benefits to the customers simultaneously.
Hi Well i am running only QSR restaurant & we are charge 5% GST to customer .i just want to know few things.
1. Is it only restaurant can take 18% gst & claim ITC.
2 is it only working restaurant can move from 5% GST to 18% GST to claim ITC
Restaurant manue card rate with GST or without gst ???
Hume kaise pata chalega ??
It is without GST
in Pannalal Restaurant they gave a bill which include 4 charges as gst
Cgst @2.5%
Cgst @9%
Sgst @2.5%
Sgst @9%
can anyone explain how this is calculated because it is more than 18%
It can not be treated as more than 18%, it states that some items have 18% gst while some have 5% gst
I went to a restaurant located in a hotel where i asked for the room tariff. The room tariff , on the reception counter, was informed to be Rs 4000.
Since, the reported tariff( it was nowhere displayed in the hotel premises) was less than Rs 7500, the applicable GST rate was expected to be 5%. However, when the bill was paid, i noticed that the GST has been charged @ 18%. On enquiry, i was replied that the room charge is Rs 8000 and that is the reason, i have been charged GST @18%.
Since i have availed only the dining service and on website also, the charges on various hotel booking sites are displayed in the range of Rs 3000 to rs 4000, it appears that hotel is charging GST wrongly with an intention to have the benifit of Input Tax Credit.
Pl advise if a consumer court case is suitable?
I went to a hotel, where not even a single table to sit and eat is available, we have to go to the counter, pay the amount and take a token(bill) where 5% GST is applied later use that token and collect food by SELF SERVICE and later we have to eat by STANDING OUTSIDE the hotel since there is not even a single table to sit.
My question here is: Do we have to pay GST in such a case? Please suggest.
The bill provided is a proper bill with CGST 2.5% and SGST 2.5% along with the GSTIN number mentioned.
Yes, you need to pay GST
Mere ko gst bill chaiye back date me mill jayega
In a restaurant, I was charged ₹29 for water bottle whose MRP is ₹19 and above that, GST OF 5%…can I make legal allegation on the hotel in consumer court.
There may be service charges included.
Your bill may include service charges of the restaurant.
In the new GST rule the restaurants are also selling the MRP product like cold drinks on that also they are charging the sitting charge not mentioned in anyhow in the bill for example if you are taking a 200 ml cold drink who is MRP is 15 rupees they will charge you 18 rupees on that they will take GST is it legal please let me know
As per recent clarification issued by the department, MRP includes all applicable taxes on it. So a supplier can’t charge over and above MRP from customers.
The current rate 5% for food eat in the restaurant and 12% for pre-packed & pre-cooked from restaurants. Is it applicable to both regular taxpayer and composite taxpayer?
please clarify
No, the rate is not same for the composite taxpayer and a regular taxpayer. For composition dealers 1% rate is applicable