The food coupon providers, catering industry and companies arranging food for employers are facing difficulties in filing GST as the tax rate varies from 5% to 18% which is not particular and rely on the category you consider them.
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- Karnataka GST AAR, it has been determined that the case of M/S. Central Police Canteen is not eligible for any GST exemption. This decision was made after careful consideration of the relevant facts and circumstances of the case.
A known tax specialist stated that, “Canteen supplies in any organisation by self or by third-party contractors have been treated as outdoor catering in the service tax regime and the tax was paid accordingly, However, clarity is required on such supplies in the GST regime given that industry is not clear whether to charge 18% as outdoor catering or 5% without credit as in the case of a restaurant.”
Generally, the canteen service attracts 5% GST and outdoor catering considers 18% GST. In November, the government reduced the 5% GST on food or beverage supplied from the mess or canteen. As the food is not made on-site and is supplied by caterers. The confusion has been raised in the industry and customers have to suffer in revenue losses. The catering industry now presented this issue in front of the GST Council and asked to resolve the confusion.
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As the employers from its own resources start providing food to the employees, there is numerous confusion over the particular clarification. Another expert from the industry states, “Since the GST rate for canteen is 5%, this should ideally apply in all cases where food is made available to employees, irrespective of the fact whether companies do it themselves or outsource it to third parties.”
A proper clarification is required to further step ahead in this matter as to what the actual GST rate would be applicable. It is now to be seen what the course of action it would take for the government to regularize the proper GST rates on different sectors including the canteen industry.
I am planning to run a single banquet hall in a mall. What tax should we charge the guest who book the hall
we are providing canteen services to some govt. companies. for this they are giving us our employees’ salary and vehicle charge for bringing raw materials., the cost for cleaning materials, cost LPG, etc. kindly advise what is the GST rate we have to claim from these companies. food is provided to employees at a subsidized mutually agreed rate. and GST 5% of food also given by these companies
I am into Catering Business, we are supplying food to Corporate and not any food services at Customer place. Since it was in supply condition and not into any services added, the GST will remain 5% or 18%?
I am into catering business & supply food to corporates through an offsite location. I need clarity whether we will be categorized under outdoor catering or canteen facility.
Your service will be treated as Outdoor catering.
Supply of food or other service provided by a restaurant, eating joint including mess, the canteen is chargeable to 5% GST as clarified by GST Council on 14th Nov,17. But many parties opt to charge 18% in a move to claim Input Tax Credit which they used to retain and not passed on to customers in many cases disregarding the anti-profiteering clause.
Unlike in Service Tax regime where all types of catering are classified under the main head of outdoor catering, different rates are fixed in GST in different types. It is expected that GST Council should amply clarify the rates in view of the divergent practices followed at different places.