Impact of GST on Hotels & Restaurants | The Learning Curve
One of the sectors of the Indian economy which continues to generate a considerable amount of confusion in the mind of the common man is the hotel, restaurant, guest house and lodging sector. In the GST regime multiple layers of taxes have been prescribed depending on the tariff rates. To empower the public with the necessary information TIOL TUBE presents a special episode on this issue.
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The rate of tax on restaurants (food) has come down effectively. Availability of ITC is an added benefit. But most restaurants have adopted a ingenious method to make a huge profit. Pre GST the tax was cacluated from the list / menu price i.e. the menu price was considered as a cum-tax price. Whereas post GST, the restaurants have maintained the same price, but charge GST 'on the' list price resulting in an increase of price of about 20% to the customers. The blame goes to the GST and the Government, whereas the money is pocketed by the restaurants.
hi if the guest house is not making rs 20,00000 turnover and the room rate is 2500 will they come under GST
18% slab is for 2500 to 7500 Room Tariff per day ?