With the Introduction of GST from 01 July 2017 almost all the sectors have undergone tremendous change whether that may be in terms of taxability, rate change, valuation etc & so is our hospitality Industry which cannot make itself untouched with these changes. Here we will try to understand something that is very close to our heart rather better to say our stomach i.e impact analysis of GST on food industry.

GST on Catering Services

With the weeding seasons ringing its bell here we have come up with Complete analysis of GST on all types of catering services.

Meaning of Outdoor Catering Services : – Outdoor catering means supply, by way of or as part of any service, of goods being food or any other article for human consumption or any drink, at Exhibition Halls, Events, Conferences, Marriage Halls and other outdoor or indoor functions that are event based and occasional in nature.

Here is a quick glance : –

S.No Nature of Supply of Service GST Rate Whether ITC Available
1 Supply of Outdoor catering at premises other than specified premises provided by any person other than –

(a) suppliers providing hotel accommodation at specified premises*, or

(b) suppliers located in specified premises*.

5% NO
2 Outdoor catering provided by suppliers providing hotel accommodation at specified premises*, or suppliers located in specified premises*. 18% YES

Apart from providing standalone catering services, caterers are also engaged in providing composite supply of Outdoor catering services which also includes various other services such as renting of premises including hotel, convention center, club , pandal, shamiana, or any other place, specially arranged for organising a function. Such supply are naturally bundled in the ordinary course of business and are treated as naturally bundled service.

Here are the quick glace on these services : –

S.No Nature of Supply of Service GST Rate Whether ITC Available

 

1 Composite Supply of Outdoor catering together with renting of premises (including hotel, convention center, club, pandal, shamiana, or any other place, specially arranged for organising a function) at premises other than specified premises provided by any person other than –

(a) suppliers providing hotel accommodation at specified premises, or

(b) suppliers located in specified premises.

5% NO
2 Composite Supply of Outdoor catering together with renting of premises (including hotel, convention center, club, pandal, shamiana, or any other place, specially arranged for organising a function) provided by suppliers providing hotel accommodation at specified premises or suppliers located in specified premises. 18% YES

GST on restaurant Service

Restaurant Service means supply, by way of or as part of any service, of goods, being food or any other article for human consumption or any drink, provided by a restaurant, eating joint including mess, canteen, whether for consumption on or away from the premises where such food or any other article for human consumption or drink is supplied.

Here we cover a quick glance : –

S.No Nature of Supply of Service GST Rate Whether ITC Available
1 Restaurant Service (Standalone Restaurant) 5% NO

 

2 Restaurant Service other than at Specified Premises

(Declared Tariff ≤ 7500)

5% NO

 

3 Restaurant Service at Specified Premises*

*(Declared Tariff > 7500)

18% YES

 

 

*Specified premises means premises providing hotel accommodation services having declared tariff of any unit of accommodation above seven thousand five hundred rupees per unit per day or equivalent.

Declared tariff means charges for all amenities provided in the unit of accommodation (given on rent for stay) like furniture, air conditioner, refrigerators, or any other amenities, but without excluding any discount offered on the published charges for such unit.

GST on Hotel Accommodation Service

Hotel Accommodation means supply, by way of accommodation in Hotels, inns, guest house, clubs, campsites, or other commercial places meant for residential or lodging purposes including the supply of time share usage rights by way of accommodation.

Here is a quick glance : –

Nature of Supply of Service Taxable Amount GST Rate Whether ITC Available

 

Hotel Accommodation Realised Tariff  upto Rs 1000 0%
Realised Tariff between Rs 1001 to Rs 7500 12% YES
Realised Tariff above Rs 7500 18% YES

 We must be aware that GST on hotel accommodation is leviable on realised amount & not on declared tariff.

Author Bio

Qualification: CA in Practice
Company: V KEDIA & ASSOCIATES
Location: KOLKATA, West Bengal, IN
Member Since: 24 Mar 2020 | Total Posts: 2

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