The recent statement by the government on service charge being discretionary for the diner, has sparked a lot of interest. However, it is important to understand the difference between service charge and service tax.
The effective incidence of service tax on food bill in air conditioned restaurants will go up to 5.6 per cent as against 4.94 per cent previously, a senior finance ministry official said today.
The service tax is currently levied at the rate 12.36 per cent including education cess.
The Odisha government on Friday welcomed the zero tax rate on common food items and reduction in tax rate from 6 to 5 per cent by the Goods and Services Tax (GST) Council.
We got in touch with some of the leading names in the restaurant industry to get a taste of their sentiments on the GST roll out.