service tax liability of five star hotel

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 December 2009
I have observed that some of the hotel were charging VAT 12.5% and Service tax @ 10.30% on basic cost of food as mentioned below:

Example:

Lunch costs 36000

Add: VAT 12.5% on Rs.36000 4500

Add: Service tax 10.30% on
Rs.36000/- 3708

----------
Grand total 44208
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I have a doubt whether both VAT and service tax is payable on basic costs.

Please clarify whether the above method of charging service tax is correct.

thanks & regards

T. Saravanakumar

GSTP Hari Dhayalan Konar

GSTP Hari Dhayalan Konar (Expert)

22 December 2009 as per my knowledge, only one is applicable. if you stay in the hotel then service tax will be applicable.

ANIL JANGID

ANIL JANGID (Expert)

22 December 2009 Renting of room/banquates added as 91a in a schedual of service tax from 2007-08.Hence service tax applicable on such receipts.
(2) Indoor catering is exempted from service tax/but vat is applicable.

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