Taxability of Banquet Hall in Hotel

[VIGNESH]

sir a hotel which has rooms, a restaurant and Banquet Hall. room tariff below 7500/- rs and tax for room is charged @ 12% and Restaurant 5%, what should be rate for Banquet Hall? is it 18% or the rate has any relevance on the room tariff !

[KASTURI SETHI]

GST is applicable for Banquet Hall @18% . It will be charged independently. No issue of composite or mixed supply is involved.

[VIGNESH]

sir as per Changes proposed in 37th GST Council Meeting dated 20-09-2019 Effective from 01-10-2019, "specified premises" term used , so in the above query room tariff below 7500/- hence 5% can be charged?

[KASTURI SETHI]

Whether proposed changes in the GST Council were notified ?

[VIGNESH]

CBIC amends notification No. 11/2017- Central Tax (Rate) so as to notify CGST rates of various services as recommended by GST Council in its 37th meeting held on 20.09.2019 vide Notification No. 20/2019-Central Tax (Rate) dated 30th September, 2019.

[KASTURI SETHI]

In this scenario, service supplier cannot escape 18%.

[Sunil Kumar]

If supply of Banquet Hall is provided along with Food (i.e. Bundled Service), it may be taxed @ 5%. However, where service of Banquet Hall provided solely, it is taxable @ 18%...

Tax Rates for Composite Supply of Food or any drink along with Renting of Premises (w.e.f. 1st October 2019)

In this case, supply includes Composite supply of “Outdoor catering” together with renting of premises (including hotel, convention center, club, pandal, shamiana or any other place, specially arranged for organizing a function).

Followings are the different tax slabs :-

(1) Composite Supply of “Outdoor catering” along with renting of Premises, at premises other than “specified premises” provided by any person other than-

(a) suppliers providing “hotel accommodation” at “specified premises”, or
(b) suppliers located in “specified premises”.

are chargeable at 5%…Provided that credit of input tax charged on goods and services used (i.e. inputs/input services) in supplying the service has not been taken.

(2)Composite Supply of “Outdoor catering” along with renting of Premises, at premises other than “specified premises” provided by–

(a) suppliers providing “hotel accommodation” at “specified premises”, or
(b) suppliers located in “specified premises”.

are chargeable at 18%…

(3) Composite Supply of “Outdoor catering” along with renting of Premises, at “specified premises”

are chargeable at 18%..

[Shilpi Jain]

Agree with Mr. Sunil

AI Summary

Banquet hall GST rate: standalone supply attracts higher rate; bundled catering may attract lower rate under conditions. Standalone banquet hall services are taxable at the higher GST tariff and charged independently; Notification No. 20/2019 (effective 1 October 2019) confirms suppliers cannot escape that higher rate. When banquet hall is bundled with food as outdoor catering, treatment as a composite supply applies: such composite supply may attract a lower rate only if provided at premises other than specified premises by suppliers who are neither hotel-accommodation providers at specified premises nor located in specified premises, and only where no input tax credit on inputs/input services has been taken; otherwise the higher rate applies.