Comments
The Finance Ministry on Tuesday reiterated that only air-conditioned or air-heated restaurants are required to pay service tax.
“Restaurants, eating-joints or messes which do not have the facility of air-conditioning or central air-heating in any part of the establishment are exempt from service tax,” it said in a statement.
At present, service tax is chargeable on services provided by restaurants, eating-joints or messes which have the facility of air-conditioning or central air-heating in any part of the establishment at any time during the year in relation to serving of food or beverages.
The statement added that in respect to such air-conditioned or air-heated restaurants which are required to pay service tax, 60 per cent of the value is to be deducted from the total amount charged while applying the rate, and the tax is to be calculated on the balance.
“With the increase in the rate of service tax to 14 per cent (subsuming the education cesses) with effect from June 1, 2015, the effective rate of tax will be 5.6 per cent of the total amount charged,” it said.
Prior to June 1, when the rate of service tax was 12.36 per cent (including education cesses), the effective rate was 4.94 per cent.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.