Service Tax not mandatory in restaurants | Fusion - WeRIndia

Whenever you visit a hotel or restaurant, you might have observed that you are paying all taxes in addition to the service charge.

The worst part is, you have no option to not pay the prescribed service charge by the hotels even though you are not satisfied with their service.

Many consumers in restaurants are forced to pay he service tax irrespective of their satisfaction with the services.

The dissatisfied consumers are complaining about the forced payment of service tax.

Following these complaints, The Department of Consumer Affairs yesterday clarified that service tax in restaurants is not mandatory but optional.

This is stated by the Department as a reply to the Hotel Association of India on the service charge. The consumers have the option and discretion to whether or not pay the service tax based on the services they obtained from the hotels and restaurants.

So far, restaurants are charging from 5 to 20 per cent in the form of service tax despite the kind of service provided to their consumers which is forcibly accepted by them.

All the hotels and restaurants are asked to publicize this information at an appropriate place so that it can be clearly visible.

The Department asked the states to check this matter and consumers can decide on paying service tax to the hotels.

So, if any consumer is dissatisfied with their services, they need not pay the tax and the service charge must be waived off.

Hence, the consumer can accept the service charge voluntarily.

As per the Consumer Protection Act, 1986 any unfair method or dishonest practice can be treated as an unfair trade practice for which a consumer can make a complaint to the appropriate consumer forum against it.

Now that it is cleared by the government, next time you need not pay any service tax if you are not satisfied with the services of hotels.

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