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CBDT asked to include service charge in tax assessment

New Delhi: Union Consumer Affairs Minister Ram Vilas Paswan has asked the Central Board of Direct Taxes (CBDT) to consider inclusion of service charge while assessing tax.

According to an official release, complaints were being received through the National Consumer Helpline about levying 5 per cent to 20 per cent service charge compulsorily by some hotels and restaurants, though guidelines to stop it were issued in April this year.

“To stop this unfair practice, hotels and restaurants have been asked either to leave the column of service charge blank or mention on the bill that it is optional. It means that the consumer can pay the service charge if he or she wants,” reads the release.

The Centre had sent the guidelines to the Federation of Hotel and Restaurant Associations of India (FHRAI), National Restaurant Association of India (NRAI) and Hotel Association of India (HAI) also.

“Hotels or restaurants cannot compel the consumer to pay service charge. Similarly, voluntary consumer organisations have also been asked to increase awareness and pick up some cases for exemplary remedial action,” reads the release.

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