The new year comes with a new GST rule for dine-in restaurants. According to the new rules, customers will now have to pay 5% GST on food from any stand-alone restaurant. No matter if the customer is dining in the restaurant, ordering for doorstep delivery, or even taking home deliveries from the restaurant, the new rule is the same at all times. Wanna know when and where the new GST gets incurred? For that, read on till the end!
Pay 5% GST For Ordering From Stand Alone Restaurants
The Authority for Advanced Ruling’s (AAR) Gujarat bench introduced this new GST regulation where the customers will need to pay a 5% GST rate for ordering food or availing of services such as eating there or ordering takeaways from the place or even taking deliveries from the restaurant itself. In the end, such restaurant services will attract this new 5% GST rate without the input tax credit. This includes ordering anything and everything from the food and beverage menu of the restaurant.
New Rule For Readily Available Packaged Items
There is a ruling for ready items sold in restaurants as well. Items such as chips, chocolates, and soda bottles. These are not made by restaurants and hence won’t fall under the category of restaurant services. These packaged-ready items will incur the applicable GST.
A circular shared by the Central Board of Indirect Taxes and Customs back in October 2022 stated that doorstep deliveries and takeaways from restaurants fall under restaurant services. In the recently conducted meeting, the AAR included the circular and a GST council meeting conducted back in the year 2017 to make the decisions.
So the next time you are placing an order from a stand-alone restaurant, keep the 5% ruling in mind. Also, with this service charges are there too. Though it is not a mandate, still many restaurants charge their customers.
What do you think of this new AAR ruling? Do let us know what you think about the new 5% GST!
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