Restaurants can’t charge 18% GST on products

Central Board of Excise and Customs issues clarification

Restaurants can’t charge 18% GST on products

Tribune News Service

Chandigarh, January 29

No restaurant can charge 18 per cent tax on products. This has been clarified by the Central Board of Excise and Customs, also known as Central Board of Indirect Taxes and Customs, in a recent communication to advocate Ajay Jagga.

Jagga has sought a clarification after he got a complaint that some of the eateries in the city were charging 18 per cent GST on products.

Jagga, in a communication to the Central Board of Excise and Customs, said an eatery in Sector 22 here was charging 18 per cent GST instead of 5 per cent on its premises, which was incorrect.

He said GST for any food item sold by a shopkeeper would be 5 per cent even if there was also a restaurant on the same premises. However, rates might be different.

Jagga said he earlier made a complaint on August 21, 2019, to the Consumer Affairs Department and even the Excise and Taxation Department of the UT Administration.

He said charging 18 per cent GST was imposition of unjustified cost on consumers. If someone charges 18 per cent tax, it tantamount to restrictive and unfair trade practice.

He said the issue needs emergent examination and penal action should be taken in public interest. It must be ensured that consumers were not charged higher GST.

In a letter to Union Finance Minister Nirmala Sitharaman, he said the Centre should issue necessary advisory to all states that restaurants should stop charging unjustified extra cost to the tune of 13 per cent, which was being imposed on consumers for items such as pastry, cake, etc..

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