I have opened up a cafe resturant in Vadodara Gujarat just like a cafe coffee day or barista this month i would like to know whether service tax is applicable or vat is applicable or both on my business or not ????
And what shall be the rate of service tax applicable coz there will be sale of goods and service element both.
Dear Kunal,
1. VAT is applicable as per the Gujarat Value Added Tax Act. You also have an option for composition scheme (paying tax at a flat rate without availing any input tax credit).
2. Service tax is applicable only if you have any part of your restaurant air conditioned. Effective rate would be 4.944%
Regards,
Pradeep
Sri Aurobindo Gnostic Centre of Education
New Delhi
CA
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