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Demand to Reduce GST Rate on Catering Services yet to be met

Many Hoteliers and caterers are urging the Centre to cut done the GST rates applicable on outdoor catering service at 5%. (Current GST rate is 18%).

A memorandum was submitted to our respected Finance Minister, Nirmala Sitharaman with respect to reduce GST rates levied on outdoor catering service from 18% to 5%. 

The said issue regarding the GST Rate on Catering Services arisen as the food served in restaurants attracts 5% GST and people have to pay 18% GST  for the same food when it served in the party hall of same restaurant.

However, The GST Council has not taken up the issue of tax rates on outdoor catering in any of its meetings yet as it was not the agenda of this meeting. Caterers expect the GST Council to take it up at its next meeting in August.

A secretary of Bengaluru Hoteliers Association said positively that “Union Finance Minister Nirmala Sitharaman is receptive and we hope our demand will be met soon”.

It would also benefit employers and employees of private companies which run canteens operated through catering service providers. Apart from caterers, food coupon providers and companies who provide food and beverages to their employees are also seeking a reduction in tax rates.

Author: Niranjan Reddy

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