Cine beneficiază de 5% TVA destinată serviciilor de restaurant și catering?
Source: Financiarul.ro.
Starting November 1, 2018, various service categories are eligible for a reduced VAT rate of 5%. This legislative change has significantly benefited the restaurant and catering sectors.
However, this new legislation may not be as advantageous for certain businesses involved in food preparation and delivery. If their activities do not qualify as restaurant or catering services under VAT regulations, they will not be able to apply the reduced VAT rate of 5%.
Two essential concepts that determine the applicability of the reduced VAT rate are:
- related services associated with the delivered food, and
- the location where the consumption occurs.
Distinguishing Between Restaurant/Catering Services and Simple Food Delivery
Restaurant and catering services involve providing food and/or beverages, whether prepared or unprepared, always accompanied by „related services.” These services must be adequate to facilitate the immediate consumption of the food.
In contrast, merely supplying food and beverages, whether prepared or not, with or without delivery, but lacking any additional related service, does not qualify as restaurant or catering service. In such cases, it is considered a simple sale/delivery of food products, which is subject to a reduced VAT rate of 9%.
What Are „Related Services”?
To ensure the correct application of the 5% reduced VAT rate, the Ministry of Public Finance has released a draft ordinance clarifying the definition of „related services.”
The draft ordinance states that the classification of operations performed by a taxable person as food delivery or restaurant/catering services is not influenced by the CAEN code assigned to their activity. Additionally, the complexity of food preparation does not affect the applicable VAT treatment.
Examples of „elements that do not qualify as related services” include: displaying food on shelves, food preparation, transporting food to the client’s specified location, cooling or heating food, packaging food, providing disposable cutlery, offering paper napkins, supplying trash bins, presenting the menu, and providing rudimentary furniture like counters or bar tables that do not allow customers to sit.
Conversely, elements that would be classified as „related services” include, among others: providing an appropriate setting for food consumption, serving food, offering staff for service, chefs, or cleaning personnel, providing dishes or cutlery, supplying suitable furniture for food consumption, such as tables and chairs, clearing or cleaning tables, offering personalized advice on food selection, and guiding clients regarding the composition and quantity of food for specific events.
Location Requirement for Immediate Food Consumption
It is crucial to note that for restaurants, immediate consumption must occur on the premises of the service provider, while for catering services, immediate consumption takes place outside the provider’s premises.
The draft ordinance clarifies the concept of „provider’s location.” This refers to a location owned, rented, or used by the restaurant service provider (including situations where there is a contract with the owner granting access to a shared space for multiple beneficiaries, along with associated maintenance costs).
Who Else Can Apply the 5% Rate?
The reduced VAT rate of 5% also applies to restaurants located in „food courts” within shopping malls. However, to qualify for the 5% VAT rate, businesses must bear the maintenance costs of the dining area and other shared expenses (such as clearing tables, cleaning the premises, and restroom access).
Supermarket and hypermarket chains can also apply the 5% rate if they have an area within the store where food is prepared and served, along with a designated space with chairs and tables for immediate consumption (using trays, plates/containers, and disposable cutlery), ensuring table clearing and cleaning services are provided.
Additionally, businesses that provide food at events (festivals, concerts, shows, fairs) can benefit from the 5% rate if they offer tables and chairs in their designated space and ensure table clearing and cleaning services.
Who Will Continue to Apply the 9% VAT Rate?
Public catering establishments that do not have a space where sufficient related services are provided for immediate consumption of food and/or beverages do not qualify as restaurant services. This includes those offering food and/or beverages at bar counters or in limited service areas without seating or allowing only a few customers to consume on-site. Examples include stands, kiosks, vending machines, or snack bars.
Furthermore, establishments that provide food and/or beverages exclusively for home delivery or pickup from a delivery point cannot apply the reduced VAT rate of 5%, as this scenario only involves food delivery, which is subject to the 9% reduced VAT rate.
Final Thoughts
Thus, businesses in this sector must conduct a two-step analysis:
- Determine if they have an appropriate location and offer related services.
- Assess whether the purchaser remains on-site to consume the food or takes it to go.
Numerous food establishments are impacted by these legislative changes, and some are required to apply different VAT rates for the same food products, depending on where the products are consumed and the related services provided. Additionally, point-of-sale software must be updated, and staff trained to understand when to apply the 5% reduced VAT rate versus the 9% reduced VAT rate.
