GST ON CIGARATEE SALE IN HOTEL

Recently there is a case study on this issue. cigarette is not naturally bundled with the service given by a restaurant. it's provided as per the request of the customer (as per the observation of high court). So cigarette sale in a hotel will come under the purview of Mixed supply. Hotel with room provide both supply of goods and services and as a mixed supply tax rate will be supply of that particular supply (here cigarette i.e 28%) which attracts the highest rate of tax. So the Tax rate will be 28%.

The following composite supplies shall be treated as a supply of services, namely:—
[a] works contract as defined in clause [119] of Section 2; and
[b] supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink [other than alcoholic liquor for human consumption], where such supply or service is for cash, deferred payment or other valuable consideration.



in any other manner is also there.So it should come under service.Also in hotels cigarate is charged above mrp extra portion is for service .