Most restaurant services are taxed at 5% without ITC — standalone restaurants (AC or non-AC), fast-food chains, takeaway and cloud kitchens. Restaurants in specified premises (a hotel with a declared room tariff of ₹7,500 or more per night) attract 18% with ITC. Zomato/Swiggy orders stay at 5%, paid by the platform. Outdoor catering is 5%; a retail ice-cream parlour is 18%.
Restaurant GST Rates — Category-Wise Table
The GST rate for every common food-service scenario in India, with ITC eligibility and the driving factor.
| Type of Supply | GST Rate | ITC | Notes |
|---|---|---|---|
| Standalone restaurant — dine-in | 5% | No | AC or non-AC — same rate |
| Takeaway / home delivery (own) | 5% | No | Restaurant supply |
| Fast food / QSR (chains) | 5% | No | Same as a restaurant |
| Cloud kitchen (delivery-only) | 5% | No | Treated as a restaurant |
| Restaurant in hotel (tariff ≤₹7,500) | 5% | No | Budget-hotel outlets |
| Restaurant in specified premises (≥₹7,500) | 18% | Yes | Premium / 5-star hotels |
| Food via Zomato / Swiggy | 5% | — | Platform (ECO) pays the GST |
| Delivery & platform fee (app) | 18% | — | Separate service |
| Outdoor catering (standalone) | 5% | No | Weddings, events, corporate |
| Ice-cream parlour (retail) | 18% | Yes | Not a restaurant service |
| Alcohol served | Outside GST | — | State VAT / excise applies |
Restaurant rates were retained under the GST 2.0 two-slab structure effective 22 September 2025. Confirm on the official GST portal before invoicing.
Which GST Rate Applies to Your Restaurant?
For regular restaurants one factor decides it: whether the restaurant is in "specified premises" — a hotel where any room's declared tariff is ₹7,500 or more per night. Everything else is 5%.
Most restaurant services — no ITC
- Standalone restaurants & budget-hotel outlets
- Dine-in, takeaway & own delivery
- Cloud kitchens, cafés & QSR chains
- Zomato / Swiggy restaurant orders
- Input Tax Credit not available
Specified premises — with ITC
- Restaurants in hotels with a room ≥ ₹7,500/night
- Most 5-star hotel restaurants
- Luxury-hotel banquets & in-house catering
- Full input-tax credit available
- Different compliance implications
You are on 5% (no ITC) if
- You run a standalone restaurant, café or QSR
- You operate a delivery-only cloud kitchen
- Your outlet is in a hotel with tariff below ₹7,500
- You supply outdoor catering as a standalone caterer
You are on 18% (with ITC) if
- Your restaurant sits in specified premises (≥₹7,500)
- You run a retail ice-cream / dessert parlour
- You provide banquet-hall renting with the package
- You bill separate app delivery / platform fees
The old distinction between air-conditioned (18%) and non-AC (12%) restaurants was abolished on 15 November 2017. Since then every standalone restaurant — AC or non-AC — charges a uniform 5% without ITC. GST 2.0 (22 September 2025) did not change this.
Not sure which rate applies to your outlet?
Get My GST Rate →GST on Cloud Kitchens, Zomato & Swiggy
A cloud kitchen (delivery-only, no dine-in) is treated as a restaurant under SAC 9963 and charges 5% without ITC. Since 1 January 2022, Zomato and Swiggy are Electronic Commerce Operators (ECOs) under Section 9(5) of the CGST Act, so the platform — not the restaurant — pays the 5% GST on the food value.
- The food value is taxed at 5% — deposited by the platform, not the restaurant.
- Delivery & platform / convenience fees billed by the app are a separate service taxed at 18%.
- On orders through your own app / website, the kitchen collects and pays the 5% itself.
- The restaurant reports these supplies in its GSTR-3B but pays no tax on them again.
How GST Adds Up — ₹500 Order
5% Standalone restaurant order
18% Specified-premises order
On the 5% rate, Input Tax Credit is not available — GST paid on rent, equipment, gas and packaging becomes an embedded cost you price into the menu. Only 18% (specified-premises) restaurants can claim ITC. Use the ITC rules to model your effective tax.
Selling on Zomato/Swiggy? Get your payouts reconciled with your GST returns.
Get Return Filing Help →GST on Outdoor Catering & Corporate Lunch
Standalone outdoor catering — weddings, events, corporate lunch, canteen run by a caterer — is taxed at 5% without ITC. Catering inside specified premises (a luxury-hotel banquet) attracts 18% with ITC.
A company buying catering / canteen services for its employees cannot claim ITC — it is blocked under Section 17(5)(b), unless the company is itself in the business of supplying that outward (e.g. a hotel providing food in an event package).
Composition Scheme — Should You Opt?
Restaurants are the only service explicitly eligible for the composition scheme: a flat 5% (2.5% CGST + 2.5% SGST) on turnover up to ₹1.5 crore (₹75 lakh in special-category states), with quarterly CMP-08 and annual GSTR-4.
Consider it if
- Turnover is small and mostly local walk-in
- You want simpler, quarterly compliance
- You don't rely on input-tax credit
Be careful if
- You need ITC on rent, equipment or inputs
- You make inter-state supplies
- You sell mainly via e-commerce aggregators
A composition restaurant pays 5% from its own pocket, cannot charge GST on the bill, and must display "composition taxable person, not eligible to collect tax" on signage.
Want us to check if composition saves you money?
Talk to a GST Expert →Restaurant GST Compliance Checklist
Registration is mandatory once aggregate turnover crosses ₹20 lakh (₹10 lakh for special-category states). Restaurants supplying through an ECO like Zomato/Swiggy may need to register regardless of turnover. Here is the full picture for a restaurant or cloud kitchen:
- GST registration (GSTIN)
- Correct GST rate classification
- Tax invoice / bill of supply
- Zomato / Swiggy reconciliation
- GSTR-1 (outward supplies)
- GSTR-3B (monthly/quarterly)
- ITC reconciliation (if 18%)
- E-invoicing applicability
- E-way bill (where relevant)
- GSTR-9 annual return
- Books & records upkeep
- Composition CMP-08 / GSTR-4 (if opted)
Choosing the GST rate is not only about the percentage — ITC availability can materially change your actual tax cost. A restaurant in specified premises at 18% may end up cheaper after credits than a 5% outlet that absorbs input GST. Model both before you decide.
Frequently Asked Questions
Related TaxClue services
Running a Restaurant, Cloud Kitchen or Catering Business?
Get your GST registration, rate classification, online-order reconciliation and monthly GST compliance handled by TaxClue's CA-led team — 100% online, across India.