Don’t Get Cheated: Everything You Need To Know About Service Charge & Service Tax

The Logical Indian

July 15th, 2015 / 11:29 AM

Image Source: Time

If you’ve had a meal at a restaurant recently, double check your receipt to make sure that you’ve not been swindled! Many restaurants and hotels have been charging customers excessively by billing them a ‘service charge’, in addition to a service tax. They then try to convince the customer that it is part of the tax that goes to the government.

The Union Finance Ministry has clarified on July 14 that ‘service charge’ has absolutely nothing to do with service tax, and it does not go into the government coffers. Instead, it ends up in the restaurant owner’s pocket.

In air-conditioned restaurants and hotels, service tax is set at 14%, but only on 40 percent of the total bill amount. The effective service tax rate, therefore works out to a mere 5.6 percent of the total amount charged. Many restaurants are also swindling their customers by charging a 14% tax on the entire bill amount.

Next time, you notice a restaurant swindling you, be a logical Indian, stand up for your rights and demand a refund. Also, don’t forget to take a photo of the overpriced bill, and post it to us!

Untitled-1 (2)

We appeal to The Logical Indian community that whenever you see restaurants charging service tax more than 5.6%, ask for an explanation.


Contributors

Edited by :

Share your thoughts..

Related Stories

Aishath Reema Ibrahim‎

“You’re Gaining Weight, Eat Less, Ladies Don’t Have Facial Hair; Things You Hear If You Have PCOS”

ltcg

Pay LTGC Tax On Long-Term Capital Assets From April 1; All You Need To Know

Everything You Need To Know About Kejriwal’s Doorstep Delivery Scheme Recently Approved By L-G

Service Charge At Restaurants Was Never Compulsory; Know Where To Complain If You’re Being Forced To Pay It

Darjeeling Protests

The Protest For A Separate State Of Gorkhaland: Everything You Need To Know

Cattle Slaughter

Everything You Need To Know About Centre’s All-India Ban On Cattle Slaughter

Latest on The Logical Indian

News

Plastic Ban: A Patchwork Of Good Intentions And Half-Hearted Implementation

Exclusive

Suspended Civil Servant Files Complaint After Twitter Trolls Issue Rape Threats To Wife

News

After India Bans PSL, Pakistan Stops Broadcast Of IPL Across Nation

News

Citing Increase In Drunk Driving Cases, Mizoram To Become Dry State From April 1

News

WB: Hunger Strike By School Service Commission Aspirants Enters 4th Week; Several Admitted To Hospital After Falling Sick

Legal

“It Is Cold-Blooded Murder,” Says Father Of J&K Principal Who Was “Killed” In Police Custody

x

Stories that deserve attention, delivered to your inbox!

Handpicked, newsworthy stories which deserve the attention of a rational generation.