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GST Rate for Restaurants

Last updated : March 18th, 2020 04:28 pm

GST Rate for Restaurants

In the 23rd GST Council Meeting held on 10th November 2017, the GST rates applicable for restaurants were reduced. From 15th November 2017, restaurants would be divided into three categories as below with the applicable rates:

Stand-Alone Restaurants

Stand-alone restaurants, eating joint including mess, canteen which does not have an attached residential or lodging facility will have to charge 5% GST on all food and drinks. The 5% GST rate will be divided between 2.5% CGST and 2.5% SGST.

Restaurants in Hotels

In case of a restaurant, mess, canteen or eating joint attached to a hotel, residential or lodging facility, the GST rate chargeable will be dependent upon the maximum room declared tariff charged by the lodging facility. Even if one of the rooms has a declared tariff of more than Rs.7500, the GST rate chargeable would be 18%. If the declared tariff for all the rooms in the

Declared Tariff Less Than Rs.7500 per Night/Day

If the declared tariff for all the rooms in the lodging facility is less than Rs.7500 per night/day, the GST rate applicable for the restaurant would be 5%.

Declared Tariff More Than Rs.7500 per Night/Day

Even if one of the rooms has a declared tariff of more than Rs.7500 per night/day, the GST rate applicable for the restaurant would be 18%.

GST Rate Notification for Restaurants

The GST rate Notification No. 46/2017-Central Tax (Rate) dated 14th November 2017 declaring the new GST rates applicable for restaurants is reproduced below for reference:

[TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

Government of India
Ministry of Finance
(Department of Revenue)

Notification No. 46/2017-Central Tax (Rate)

New Delhi, the 14th November, 2017

G.S.R……(E).- In exercise of the powers conferred by sub-section (1) of section 9, subsection (1) of section 11, sub-section (5) of section 15 and sub-section (1) of section 16 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, and on being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No.11/2017- Central Tax (Rate), dated the 28th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 690(E), dated the 28th June, 2017, namely:-

In the said notification, in the Table, –

(i) against serial number 3, in column (3), in item (vi), for the words “Services provided”, the words “Composite supply of works contract as defined in clause (119) of section 2 of the Central Goods and Services Tax Act, 2017, provided” shall be substituted;

(ii) against serial number 7,- (a) for item (i) in column (3) and the entries relating thereto in columns (3), (4) and (5), the following shall be substituted, namely:-

3	4	5
“(i) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, 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, other than those located in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent. Explanation.- “declared tariff” includes 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.	2.5	Provided that credit of input tax charged on goods and services used in supplying the service has not been taken [Please refer to Explanation no. (iv)].”;

(b) for item (iii) in column (3) and the entries relating thereto in columns (3), (4) and (5), the following shall be substituted, namely:-

3	4	5
“(iii) Supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink, where such supply or service is for cash, deferred payment or other valuable consideration, 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, located in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent. Explanation.- “declared tariff” includes 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.	9	-”;

(d) in item (ix), in column (3), for the entry, the following entry shall be substituted, namely:-

“(ix) Accommodation, food and beverage services other than (ii), (iii), (v), (vi), (vii) and (viii) above.

Explanation.- For the removal of doubt, it is hereby clarified that, supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or drink, where such supply or service is for cash, deferred payment or other valuable consideration, 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, other than those located in the premises of hotels, inns, guest houses, clubs, campsites or other commercial places meant for residential or lodging purposes having declared tariff of any unit of accommodation of seven thousand five hundred rupees and above per unit per day or equivalent shall attract central tax @ 2.5% without any input tax credit under item (i) above and shall not be levied at the rate as specified under this entry.”;

(iii)against serial number 26, in column (3), in item (i), after sub-item (h), the following shall be inserted, namely: –

‘(i) manufacture of handicraft goods.

Explanation. – The expression “handicraft goods” shall have the same meaning as assigned to it in the notification No. 32/2017 -Central Tax dated the 15th September 2017 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 1158 (E), dated the 15th September 2017 as amended from time to time.’.

2. This notification shall come into force with effect from 15th of November, 2017.

[F. No.354/173/2017 -TRU]

(Ruchi Bisht)
Under Secretary to the Government of India

Note: -The principal notification was published in the Gazette of India, Extraordinary, vide notification No. 11/2017 – Central Tax(Rate), dated the 28th June 2017, vide number G.S.R. 690 (E), dated the 28th June 2017 and was last amended by notification No. 31/2017-Central Tax (Rate) dated the 13th October 2017 vide number G.S.R. 1273(E), dated the 13th October 2017.