The government has imposed a same 18 percent Goods and Services Tax (GST) slab rate on ice cream whether sold inside the parlour or outside. However, earlier, ice creams attracted 5 percent tax when sold inside parlours and 18 percent outside.
In this regard, a Ministry of Finance directive to tax officials stated, “It is clarified that where ice cream parlours sell already manufactured ice cream and do not cook/prepare ice cream and do not cook/prepare ice cream for consumption like a restaurant, it is supplied ice cream as goods and not as a service, even if the supply has certain ingredients of service. Accordingly, it is clarified that ice cream sold by a parlour or any similar outlet would attract GST at the rate of 18 percent.”
Further, the ministry also clarified that as per GST Council recommendation, the service provided by way of cooking and supply of food, by cloud kitchens/central kitchens are covered under ‘restaurant service’ and attracts 5 percent GST without ITC. It is clear that takeaway services and door delivery services for consumption of food are considered as restaurant service.