PANAJI
A survey of restaurants and cafes in Panaji showed that consumers end up paying between 18% to 28% of their bill amount as taxes to the government. Many upmarket restaurants even charge a service charge over and above these taxes.That s a lot as it means that you may end up paying Rs 280 simply as taxes if your restaurant bill is Rs 1,000. A sum of Rs 280 can actually get you a meal at a decent restaurant. So, what constitutes this whopping tax that people end up paying when they eat out?In Goa, there s a value-added-tax (VAT) of 12.5% on soft beverages and food at restaurants. However, VAT may stretch up to 20-22% for alcoholic drinks. Then, there s a service tax of 5.6%, a Swatch-Bharat cess of 0.2% and over and above this quite a few restaurants even charge a service charge.Now, the service charge is not mandated by any law. It s a charge imposed by restaurants for serving you, when you are already paying a service tax. The difference is service tax goes to the central government, while the service charge goes to the restaurant.Restaurants maintain that it is a charge because they keep staff like waiters to serve customers. In a way, it is the tip, which you would have paid voluntarily, being loaded in your bill rather involuntarily.So, it s more of a norm than an exception that people get shocked seeing their bill at a restaurant. Some, restaurants, however, take the more responsible approach. “On our menu, we show prices inclusive of all taxes. Because when you don t do that and show ar lesser price on menu and then apply all the taxes, the customers get rshocked,” said the owner at Basserra Restaurant at Panaji.A lot of rrestaurants catering to middle-income customers show a price on the rmenu, which their clientele is comfortable paying. For example, Rs 100 rfor a fish-thali. This price includes all the taxes. So, the customer rthinks that he has paid only Rs 100 and the restaurant pays taxes to ther government out of this sum of Rs 100.But, there are lot of things whichr customers should be careful about. For example, service tax, by the rvirtue of it, is applicable only on the service given to the customer rwhile eating at a restaurant.Sandip Bhandare, a senior chartered raccountant, said, “Suppose a restaurant has a take-away counter as well ras dining area for people to sit and have food. In such a case, you are rnot supposed to pay a service tax if you are buying food from take-away rcounter because you are not sitting there and having food and therefore rthey aren t providing any service to you.”
