Service Tax On AC Restaurant Bills At 5.6%: FinMin

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Finance Ministry official has stated that the effective incidence of service tax on food bill in air conditioned restaurants will go up to 5.6 per cent as against 4.94 per cent previously, reported PTI.

Service Tax On AC Restaurant Bills At 5.6%: FinMin
The increased incidence is consequent to surge in service tax from 12.36 per cent to 14 per cent with effect from June 1.

Air conditioned hotels and restaurants attract a service tax on 40 per cent of the billed amount.

"14 per cent service tax on food/beverage in air conditioned hotels and restaurants calculated on 40 per cent of bill amount. Effective tax rate 5.6 per cent," Revenue Secretary Shaktikanta Das said.

He also said that food/beverage bills in non air conditioned hotels and restaurants are exempt from service tax.

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Story first published: Thursday, June 4, 2015, 12:30 [IST]
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