Service Tax On Food Item - Educational Cess
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Service Tax On Food Item - Educational Cess

debajyotigoswami Started The Discussion:

Dear All, Could anyone tell me what is the rete of Service tax on Food items. Also tell me what is the % of service tax and educational cess. Thanks & Regards Debajyoti

debajyotigoswami - Member Since: Dec 2006
Hi,

I have a bill with me where both VAT @12.5%, Service charge@10% and Service Tax @7.42% has been charged on food items. Apart from this 12.36% of Service tax is charged on Non food items.

I need to know the ST rate & educational cess on food items.

Thanks
Debajyoti

ms14 - Member Since: Feb 2008
Dear Rajeev

At present I do not know of the tax rates but
I think the following article may interest you.

http://allindiantaxes.com/f.%20no33297-tru.php

although it is not clear which food items & at what point of incidence you have been charged the service tax. Without the whole thing being clear it is not possible to comment on the applicablity of service tax. let us know the situation, it will be a learning factor.

regards
ms14

navneet_kalsi - Member Since: Jan 2008
hi

Mfy & selling of food item is covered under service category( outdoor Caterer) being outdoor caterer u r liable to charge vat as well as service tax. the effective figure r as follows

100 pastry @ RS.50 = 500.00

Add: Vat 12.5% (Haryana) 60.00
Add: service tax 12.36% = 62.00
Less: abatement of 50% 31.00
of service tax as per notification
20/2004 -----------------
591.00
------------------

dharmu_lalwanis - Member Since: Feb 2008
hi debjyoti i m dharmesh well i m into facility management services located in mumbai wel the service tax is 12.36% which includes the edu cess. i haaenot mentioned the break up please note this. thnx dharmesh.

U.K.Singh - Member Since: Jan 2008
To my knowledte Service tax presently is 12.36% which includes education cess also. There is education tax of 2% charged on Total Income Tax payable by an individual.

debajyotigoswami - Member Since: Dec 2006
Dear Mr. Sharma,

Yes, the current service tax slab is 12.36% (12% is service tax + 3% {of 12%} is educational charge).

I agree with ms, I have not clearified the term food item. HERE it is---

Few days back i booked a venue (in Delhi) for some offical party. I have received the bill.
In the bill, they have charged me 12.5% VAT & 7.42 % Service tax on food items. Apart from this they have also charged me 12.36% Service Tax on non food items.
As er as non food item is concern, i have no problem the calculation of Service tax. I am little confused over the calculation of ST on food items.

Can anyone tell me how (what is the calculation) they have charged me 7.42% of ST,

Thanks & Regards
Debajyoti

debajyotigoswami - Member Since: Dec 2006
Dear Mr. Sharma,

Yes, the current service tax slab is 12.36% (12% is service tax + 3% {of 12%} is educational charge).

I agree with ms, I have not clarified the term food item. HERE it is---

Few days back i booked a venue (in Delhi) for some official party. I have received the bill.
In the bill, they have charged me 12.5% VAT & 7.42 % Service tax on food items. Apart from this they have also charged me 12.36% Service Tax on non food items.
As er as non food item is concern, i have no problem the calculation of Service tax. I am little confused over the calculation of ST on food items.

Can anyone tell me how (what is the calculation) they have charged me 7.42% of ST,

Thanks & Regards
Debajyoti

eshpra - Member Since: Dec 2007
Hi,

It is argued that supply of food is termed as a “deemed sale” which is charged to sales tax by the State Governments and as such it is not liable to service tax. :)

In this context it may be clarified that deeming the supply of food in a restaurant as a sale does not in any way bar the levy of service tax on the service provided by outdoor caterers which is primarily a tax on service rendered by an outdoor caterer. :roll:

It is pertinent to note that the service rendered by outdoor caterers is clearly distinguishable from the “indoor” services rendered in a restaurant or hotel. In the case of outdoor catering service the food/eatables/drinks are of the choice of the person who partakes of the service; s/he is free to choose the kind, quantum and the manner in which the food is to be served. As against this, while eating in restaurant or hotel where the customer’s choice of the food is bound by the menu card.

Again in the case of outdoor catering the customer is at liberty to choose the time and place where food is to be served. In the case of an outdoor caterer the customer negotiates each element of the catering service, including the price to be paid to the caterer. Outdoor catering has an element of personalised service provided to the customer the service element is the more weighty, visible and predominant aspect in the case of outdoor catering.

It may also be clarified that sale of food across the counter, as in fast-food joints/restaurants or serving of food in a restaurants/hotels do not fall within the ambit of outdoor catering. Nor does mere free delivery (or delivery at a nominal cost to cover transport charges) of food by a fast food joint, restaurant etc. shall be subject to service tax as in such cases there is no service element and only a mere sale of food.

You can also get more info. at
http://www.servicetax.gov.in/st-actmainpg.htm

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