Prior to 01.04.2013, service tax was leviable on restaurants satisfying two conditions namely (i) the facility of air-conditioning or central heating in any part of the establishment, at any point of time during the year, and (ii) a license to serve alcoholic beverages. With effect from 01.04.2013, condition number (ii) stands deleted. Accordingly service tax is leviable to all restaurants satisfying condition (i).

This was stated by Minister of State for Finance, Shri Namo Narain Meena, in written reply to a question in the Lok Sabha today.

DSM/RS/rs

(Release ID :95540)

Service tax on restaurants now applies where air conditioning or central heating is provided; prior alcohol license requirement removed. With effect from 01.04.2013 the requirement of a license to serve alcoholic beverages has been deleted; accordingly, service tax is leviable on restaurants that satisfy the facility of air conditioning or central heating condition alone.