Sources have stated that if you visit a restaurant or a cafe now that the Goods and Services Tax (GST) has been rolled out, the breakup of your bill will look different than it used to before GST. It was stated that GST, which has come into effect from July 1, 2017, has subsumed 17 indirect taxes and 22 cesses which were at different rates across different states.
Previously a normal restaurant bill used to show a plethora of taxes which were charged by the state (VAT/sales tax) and the central government (Service tax) addition to the service charge levied by the restaurant owners. Meanwhile it was stated that under the new tax regime, the GST council has divided the restaurant into two categories for AC restaurant and Non- AC restaurant.
Moreover it was reported that the restaurant owners used to levy service
tax on the service charge in addition to levying VAT and service tax on the
food items. Now under the GST, the consumer will be paying a single tax on the
food bill plus of service charge levied by the restaurant owners, says Abhishek
Jain, Partner, Indirect Tax , EY India. Recently my friend went to a hotel
to have Medu Vada and in the bill the Vada costs Rs. 65 and after tax it was
Rs. 70. Even I visited a Dhabha and the bill came as Re. 635.10, but after tax
it had come as Rs. 749. I was totally shocked.
