GST Rate for Restaurants in India - Updated 2026 Slab & HSN Details

Introduction to Restaurants in India

India is a diverse country with a wide range of cuisines, and the restaurant industry plays a significant role in the country's economy. With the implementation of the Goods and Services Tax (GST) in 2017, the tax structure for restaurants in India has undergone significant changes. In this article, we will provide a comprehensive overview of the GST rates and regulations applicable to restaurants in India.

GST Rates for Restaurants in India

The GST rate for restaurants in India is 5% for non-air-conditioned and non-licensed restaurants, and 18% for air-conditioned and licensed restaurants. The following table provides a detailed breakdown of the GST rates and HSN/SAC codes applicable to restaurants in India:

HSN/SAC Code	Service Description	GST Rate
9963	Non-air-conditioned and non-licensed restaurant services	5%
9963	Air-conditioned and licensed restaurant services	18%

Restaurants in India: Tax Breakdown and Compliance

The tax breakdown for restaurants in India includes the GST rate, which is applicable to the total bill amount. The following calculator widget can be used to calculate the total GST amount payable on a given bill amount:

Calculate GST

function calculateGST() { var billAmount = document.getElementById("billAmount").value; var gstRate = 0.05; // 5% GST rate for non-air-conditioned and non-licensed restaurants var gstAmount = billAmount * gstRate; document.getElementById("gstAmount").innerHTML = "Total GST amount: ₹" + gstAmount.toFixed(2); }

Comparison with Pre-GST Tax Regime

Prior to the implementation of GST, the tax structure for restaurants in India was complex, with multiple taxes such as service tax, value-added tax (VAT), and luxury tax. The pre-GST tax regime had a higher tax burden, with an effective tax rate of around 20-25% for restaurants. The GST regime has simplified the tax structure, with a lower tax burden of 5% for non-air-conditioned and non-licensed restaurants and 18% for air-conditioned and licensed restaurants.

Frequently Asked Questions

The following are some frequently asked questions regarding input tax credit and compliance for restaurants in India:

• What is the input tax credit available to restaurants in India? The input tax credit available to restaurants in India is the tax paid on inputs such as food ingredients, cooking oil, and other supplies.
• How can restaurants in India claim input tax credit? Restaurants in India can claim input tax credit by filing Form GSTR-3B and Form GSTR-2A, and by maintaining proper records of input tax invoices.
• What are the compliance requirements for restaurants in India? The compliance requirements for restaurants in India include obtaining a GST registration, filing GST returns, and maintaining proper records of sales and purchases.

Compliance Tips

To avoid common billing mistakes and ensure compliance with GST regulations, restaurants in India should follow the following tips:

1. Obtain a GST registration and display the GSTIN on all invoices and receipts.
2. Maintain proper records of sales and purchases, including input tax invoices and output tax invoices.
3. File GST returns on time, including Form GSTR-3B and Form GSTR-1.
4. Claim input tax credit only on eligible inputs, and ensure that the input tax credit is properly matched with the output tax liability.

Conclusion

In conclusion, the GST regime has simplified the tax structure for restaurants in India, with a lower tax burden and a more streamlined compliance process. However, restaurants in India must still comply with GST regulations, including obtaining a GST registration, filing GST returns, and maintaining proper records of sales and purchases. By following the compliance tips and using the GST calculator widget, restaurants in India can ensure accurate billing and compliance with GST regulations.