Thursday, December 24, 2015

Bill, Service charge, Service tax n other buff, WTF!



Eating in restaurants! How common is that? as common as downloading movies from torrents :p. We judge the quality of food, the environment, the crowd, the staff and I am telling you, you are getting duped! How come? Where? Not possible! Wait lemme explain. How often do you check your bill which comes in better arrangements than your ordered food? Not talking about its totaling instead its components VAT, Service tax, Service charge. Yes now were are talking; Never!

So taking the lid off. How are they duping you? First let us understand what are these non-so alien terms-

·         Service charge - it’s just like a tip (which is compulsory to pay) and its rate depends on                                          the mood of the owners :p its goes in their pockets.

·         Service tax         - Damn! Compulsory extortion. It goes to central govt.

·         VAT                      - Sister of service tax. It goes to state govt.


Taaadaaaa! now you have the power! Ehh?? No not so soon. Let’s come to the working part.
First of all "no service tax" in non-air conditioned/heating restaurants (beware Richie Richs you are being targeted here).


The net trick- indoor(hotels, restaurants etc.) and outdoor(functions and parties etc.) catering stuffs. 

For indoor eating joints and points service tax will be on 40% of bill amount plus service charges ( service tax rate being 14%) and for outdoor caterings it'll be 60% of the bill amount and service charges. VAT will always be on the full amount (excluding service tax) check the calculations below and catch all the wallet burners! 

So pls don't you ever disappoint me and pay service tax on the full bill amount. Remember the 40% and 60% rule.

Now You have the power (;
Say thank you later :p

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