Further Updates:
Updated November 15th, 2017
The GST on restaurant bills will be as following going forward:
5% GST on all restaurant food and beverage bills except the premium star hotel restaurants
18% GST on restaurants in star rated hotels where per day room charges are Rs.7,500/- and upwards.
Updated July 1st, 2017
With the introduction of GST, the restaurant bill format and calculation is pretty straightforward and simple. The following table summarizes the GST rates on restaurant bills.
| Restaurant Type | GST Rate |
| Non-AC, Non-Heated Restaurants without bar | 12% |
| AC or Heated Restaurants (With or Without Bar) | 18% |
| Restaurants attached to 5-Star Hotels | 28% |
Important:
- Home delivered or takeaway food from restaurants categories listed above would still attract the respective rates, regardless of the fact that you are not availing Air conditioning or Heating services
- The service charges in the particular restaurant, if any, should not be charged any GST because that’s already covered under GST. If any restaurant does so, you must raise your concern with the management
- If a restaurant is charging GST but if their 15 digit registered GSTIN Number is not present in the bill, you don’t need to pay any GST
- Further, you may check the validity of the GSTIN number present in the bill, by searching for the same at the following URL:
Check for fake GST number
Old post on calculating restaurant bill based on VAT, ST, SC etc continues below…
How many times hasn’t your bloated restaurant bill left you clueless as to how components like VAT (Value Added Tax), ST (Service Tax), SC (Service Charge) etc are being calculated?
Worry no more…
Without complicating the matter much, let me explain how a typical restaurant bill break up is arrived at as per the prevailing taxing norms as of June 1, 2015.
VAT, ST and SC
The following are the rules for calculating VAT, ST and SC.
VAT is typically charged at 14.5% on all food items and non-alcoholic beverages (includes, packaged water, juices, mocktail etc).
VAT for alcoholic beverages and cocktails is 5.5%.
SC is charged at restaurant owner’s will. This can vary from 0% to 20%. This is like an in-built tip and if Service charge is levied, it has to be clearly mentioned in the menu.
ST is calculated at 5.6%. Service Tax is actually 14% and it is applicable on 40% of the total bill (Including food total + Service charge).
ST* = 5.6%, i.e. 14% of 40
Notes:
(i). As per the government rule, the Service Tax is applicable only to those restaurants and food joints having the air-conditioning or central air-heating facility
(ii). VAT should not be levied on the Service Charge part. There are some restaurants who do such wrong calculation practices (See comments section)
(iii). ST* has been hiked to 5.8% (Including Swachh Bharat Cess or SBC) after this article was written
(iv). ST* has been hiked further to a total of 6% (Including SBC and KKC – Krishi Kalyan Cess) in 2016
A Sample Restaurant Bill Format and Calculation
Attached here is a sample restaurant bill that I recently (after June 1st, 2015) got from our family dine out.
(Click on the image to Enlarge)
The table below explains how the above bill amount is calculated.
Please note that some restaurants may provide separate bills for alcoholic beverages and the food. In such cases the applicable VAT is different for both the bills.
| Particulars | Amount |
| A. Alcoholic Beverages (330+680) |
1010.00 |
| B. Food & Non-Alcoholic Beverages (170+160+260+320+300+360) |
1570.00 |
| C. Service Charge @ 10% for this place (10% of A+B) |
258.00 |
| D. VAT for Alcoholic Beverages @ 5.5% (5.5% of A) |
55.55 |
| E. VAT for Food & Non-Alcoholic Beverages @ 14.5% (14.5% of B) |
227.65 |
| F. Service Tax @ 5.6%, rounded (5.6% of A+B+C or 1010+1570+258) |
158.93 |
| Total Net (A+B+C+D+E+F) |
3280.13 |
Hope that explains how the final rounded bill amount of Rs.3280/- is arrived at. Next time, please pay attention to your bill details because many restaurants may not have changed their billing system yet.
Happy Dining!