GST council provides relief for hotels and outdoor catering

The Goods and Services Tax (GST) Council on Friday doubled the GST rate for caffeinated beverages such as Thums Up Charged and Red Bull from 18 percent to 40 percent while giving relief for hotels and outdoor catering services.

Demanded strongly to cut the rates for automobiles, the only reduction announced was for 11- to 13-seater minibus and the cess component at that.

Union Finance Minister Nirmala Sitharaman, who chaired the meeting, said the GST on caffeinated beverages was raised to 28 percent plus a cess of 12 percent against the current rate of 18 percent.

Abhishek Jain, the tax partner at EY, said: “This is aligned to the government's agenda of deterring the consumption of deleterious drinks. This now brings rates on such drinks on a par with aerated drinks.”