The Group of Ministers (GoM) set up to make the GST composition scheme more attractive held its first meeting in New Delhi today. The five member GoM, headed by Assam Finance Minister Himanta Biswa Sarma has been tasked to revisit Goods and Services Tax (GST) rates for restaurants.
The other members of the GoM are Bihar Deputy Chief Minister Sushil Modi, Jammu and Kashmir Finance Minister Haseeb Drabu, Punjab Finance Minister Manpreet Singh Badal and Chhattisgarh Minister of Commercial Taxes Amar Agrawal.
It will examine whether the AC restaurants pass on the benefit of cost reduction under GST to consumers and if they are not, whether they should be disallowed input tax credit claims. Currently, GST is levied at 12 per cent on non-AC restaurants and 18 per cent on air-conditioned restaurants.
The GoM was set-up by the GST Council in its last meeting on 7th of this month. It will submit its report by the end of next month. The council had also hiked the threshold for availing of the composition scheme to one crore rupees from 75 lakh.
The tax rate for traders of goods in the composition scheme is 1 per cent, while it is 2 per cent for manufacturers and 5 per cent for restaurants.
