New Delhi: There has been a lot of confusion on the GST rate that would be levied on certain items or services. The Gujarat bench of GST Authority for Advance Rulings (AAR) recently cleared a similar doubt over how much GST would apply to food ordered or consumed at a standalone restaurant.
If you are planning to dine-in, takeaway or order food from a standalone restaurant, you will have to pay 5 per cent GST. The Gujarat AAR in a recent ruling maintained that the said rate would apply to dine-in, takeaways and doorstep deliveries by a standalone restaurant.
No matter whether a customer consumed food & beverages prepared and supplied to them in the restaurant itself or by way of a takeaway, this would qualify as a ‘restaurant service’. This attracts GST at 5 per cent without input tax credit, the Gujarat AAR ruled this in the case of Riddhi Enterprises (the applicant is a stand-alone restaurant), ToI reported.
GST on ready food items
During the hearing, the AAR bench also clarified on the GST levy on over-the-counter supply of ‘readily available’ food & beverage items. Such items like chocolates, chips or bottled beverages that are not prepared by the restaurant will not come under ‘restaurant service’ and thus would attract the GST rate applicable to each such item.
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The AAR bench cited a 2017 GST council meeting for the ruling along with a recent circular issued by the Central Board of Indirect Taxes and Customs (CBIC). The notice issued last year in October clarified that takeaway and doorstep delivery services fall within the ambit of ‘restaurant services’.
In another such ruling, Telangana GST Authority of Advanced Ruling (AAR) had last year clarified that ready-to-eat popcorn will attract 18 per cent GST. Another AAR had stated that a higher GST will be levied on pizza toppings. The Haryana body said that since toppings are not pizza, 18 per cent higher GST should be applied on them.
