Eating out at restaurants will get cheaper as GST council, which lowered the tax rate to a uniform five per cent from 12 per cent on non-AC restaurants and 18 per cent on air-conditioned ones comes into effect from today.
Following the biggest GST rejig till date, prices of over 200 items, most of them being of daily use, are set to get cheaper from today.
Bringing respite to consumers and businesses amid economic slowdown, the GST Council in its 23rd meeting last week approved the biggest ever change to the tax rates of 178 items from the highest tax slab of 28% to 18% under the GST regime.
In a significant change, the GST Council lowered the tax rate of restaurants to a uniform 5 per cent from 12 per cent on non-AC restaurants and 18 per cent on air-conditioned ones, a move that will bring down the cost of eating out.
However, restaurants will not be entitled to the benefit of input tax credit (ITC). Restaurants in hotels that charge a room tariff of Rs. 7,500 or more per day will be levied the GST rate of 18 per cent but input tax credit is allowed for them.
Also under the tax changes, other items like condensed milk, refined sugar/sugar cubes and pasta, which were taxed at 18 per cent, will come under the lower slab of 12 per cent. Tax rates on some other items will fall from 18 per cent to 5 per cent and from 5 per cent to nil.
The GST Council also exempted a few goods from IGST like – ‘lifesaving’ medicines, goods under lease agreements, skimmed milk and specified goods by a sports person of outstanding eminence.
(Sources)