Post GST Confusion on Restaurant Food Bill : CLARIFIED!

After coming into effect from July 1, the Goods and Services Tax has resulted in quite a bit of confusion. Half of the populace is still unaware of what it entails and the other half are left floundering and quite unsure of which rates apply to what product. But who cares about other products, right? Jesus, we just wanna know if food got cheaper! So we’ve broken it down for y’all.

Take a look.

Now, the food you order will attract one of the 3 rates – 5%, 12% or 18%.

Tiny restaurants with an aggregate turnover of less than 75 lakhs will charge a minimal amount of 5%. This includes most of your roadside joints and dhabas. (It’s Dal Makhani time, yo!)

Restaurants with no A/C and not serving liquor will cap at 12%.

Whereas, restaurants which do have A/C (partialor full), both with or without alcohol, will charge 18%.

To clarify it further, if a restaurant is fully A/C and is also serving liquor, the tax will still remain 18%. Hurray! A new development is that eating at a five star restaurant will still cost you 18%, a rollback from the previously decided 28% luxury tax. Now you won’t have to pinch pennies for that grand dinner at ITC!

Keeping in mind the Pre-GST rates: a total of around 20.5% (14.5% VAT + 6% Service Tax), food has unquestionably gotten cheaper. Do you know what that means? More food!

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