GST Rate for Restaurants
Under the Goods and Services Tax (GST) regime in India, restaurants are classified as "eating out joints" and fall under the 5% GST rate. However, there are certain conditions that may affect the rate applicable to a particular restaurant.
For example, if a restaurant is located within a hotel where the room tariff exceeds Rs. 7,500 per night, the restaurant will be considered as part of the hotel and will be subject to the same GST rate as the hotel, which is 18%. This means that restaurants located within high-end hotels will be subject to the higher 18% GST rate, and will also be able to claim input tax credit (ITC) on their purchases.
On the other hand, if a restaurant is not located within a hotel or if the room tariff in the hotel is below the specified amount, it will be subject to the lower 5% GST rate, but will not be able to claim input tax credit (ITC) on its purchases.
As per the GST rate structure, food supplied by Indian Railways, as well as standalone restaurants (including takeaway), are classified as "restaurants and food services" and are subject to a 5% GST rate without the option to claim input tax credit (ITC).
GST Rate on Food Items
The GST rate on food items varies depending on the type of food item and how it is sold. Here are the some GST Rates on Food Items
- dried vegetables that are packaged and labelled - 5%
- dried leguminous vegetables that are pre-packaged and labelled - 5%
- milk and cream that is concentrated or contains added sugar or sweeteners -5%
- curd, lassi, and buttermilk that is pre-packaged and pre-labelled - 5%
- yoghurt and cream, whether containing sugar/flavouring or not - 5%
- meat that is packaged and labelled - 5%
- birds’ eggs which are not in a shell - 5%
- rice, pre-packaged and labelled - 5%
- wheat or meslin, pre-packaged and labelled - 5%
- rye, pre-packaged and labelled - 5%
- cereal flours other than of wheat or meslin, rye, etc., pre-packaged and labelled - 5%
- vegetables, fruits, nuts, and edible plant parts that are preserved using sugar - 12%
- fruits, nuts, and edible plant parts that are preserved and/or prepared using vinegar and/or acetic acid - 12%
- chocolate and food preparations containing cocoa - 18%
- fresh and/or chilled vegetables - Nil
- frozen vegetables - Nil
- dried leguminous vegetables other than pre-packaged and labelled - Nil
- fresh/dried coconuts, grapes, apples, bananas, and pears, among others - Nil
- fruits like grapes, apples, bananas, pears, mangoes, citrus fruits, and berries, among others - Nil
- fresh milk, pasteurised milk (excluding UHT milk), and milk and cream (not concentrated nor contains added sugar or sweeteners) - Nil
- curd, lassi, and buttermilk, other than pre-packaged and pre-labelled - Nil
- fresh or chilled meat and fish - Nil
- birds’ eggs in shells - Nil
- rice other than pre-packaged and labelled - Nil
- wheat or meslin (i.e. maize flour) other than pre-packaged or labelled - Nil
- rye other than pre-packaged and labelled - Nil