Even as liquor does not fall under Goods and Services Tax (GST) ambit, some city-based hotel owners are charging GST on liquor consumption as well. A bill in the possession of Chandigarh Newsline showed how GST of 18 per cent was charged on beer.
Ajay Jagga, a social activist who has published a book, ‘Guide to GST,’ has said the restaurant sector needs to be made more aware. “Not just restaurant owners, even the consumers should be aware that alcohol and liquor consumption has been kept out of GST,” Jagga said. Jagga has written to Deputy Commissioner Ajit Balaji Joshi where he mentioned the law as well.
“Article 366(12A) of the Constitution that the Goods and Services tax (GST) as a tax on supply of goods or services or both, except supply of alcoholic liquor for human consumption. So alcohol for human consumption is kept out of GST by way of definition of GST in the constitution. But restaurant owners are charging it,” the letter said.
“Since it is just two days since GST has set in, I am intentionally withholding the identity of both the chains as at this point of time, I would like to term this as an error or unawareness. However, if this continues after a month, I will release the names. The idea is to help business entities to adopt and migrate GST in a proper manner, without being penalised for their genuine errors or error due to transition process,” Jagga added.
Also, in another case, a hotel owner charged service tax of six per cent is charged which is not in place from July 1.
Amrinder Pal Singh, president, Hotel and Restaurant Association of Chandigarh, said because it was an altogether new system, people are unaware. “Nobody knows GST properly. There are teething problems when a new system is brought in place,” he said.