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Madhur   15 December 2015

Budget hotel service tax

Hi, I had a few qureies about service tax applicable in Hotels,

1. Service tax applicable in hotels is on the published tariff or on the amount calculated after giving discount on the published tariff. e.g. If there is a hotel XYZ with published tariff Rs. 1200 and is offering a 10% discount on the published tariff. Then is 8.7% service tax applicable on Rs. 1200 or on Rs. 1080(1200 minus 10% discount)?

2. Is 8.7% service tax applicable on extra bed offered in a room. If I charge Rs. 300 for extra bed in a room, then will I charge the guest Rs. 326.1 (300 + 8.7% service tax)?

Kindly Guide
 

 



Learning

 6 Replies

siddhartha sinha   15 December 2015

1. On discounted price minus luxury tax if declared tarriff is > 1000/day 2. Yes you have to collect on bed charges as well.

jyotirmaya behera (advocate)     16 December 2015

Service tax is calculate over ( after the discount if there is) total amount. Ex:- if in a restaurant you take some food sum of Rs. 1000/- and there is the discount of 10% that means you have to pay service tax after the discount i.e. Rs 900/-. If you add some more then what ll be the total amount which you will be pay, over that amount that service tax will be applicable.

jayantakumarray   21 December 2015

Service tax is payable on gross value less discount if any. In the instant case service tax is payable on room tariff less discount if any plus extra amount received for extra bed provided to the clients.Thanks.

jayantakumarray   21 December 2015

Service tax is payable on gross value less discount if any. In the instant case service tax is payable on room tariff less discount if any plus extra amount received for extra bed provided to the clients.Thanks.

jayantakumarray   21 December 2015

Service tax is payable on gross value less discount if any. In the instant case service tax is payable on room tariff less discount if any plus extra amount received for extra bed provided to the clients.Thanks.

T. Kalaiselvan, Advocate (Advocate)     25 December 2015

Though the query pertains to Tax consultancy section, the experts above have clarified well and I concur with their views. 


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