KNOW THE LAW

SERVICE TAX is a tax on the services. It is charged at 15 per cent (including Swachh Bharat cess and Krishi Kalyan cess) on 40 per cent of the bill. So it amounts to 6 per cent on the total bill. Service tax doesn’t go to the service provider, i.e., the restaurant; rather, it goes to the government. SERVICE CHARGE is not a tax and so the restaurants can’t force it on the customer. It is equivalent to a tip one pays to the restaurant staff. Restaurants nowadays levy service charge at 10 per cent but one is not mandated to pay the same.