The finance ministry may soon clarify that takeaway and home delivery of food will not attract service tax, a move that will be welcomed by the likes of McDonalds, Dominoes and Pizza Hut.
"The ministry is examining the issue.
There is a strong view that takeaways and home deliveries should not attract service tax," a senior government official told ET.
Finance minister P Chidambaram is also understood to have favoured this reading of the service tax rules.
The finance ministry's clarification, if it finally materialises, will bring the much-needed relief to the industry that has made several representations to the government seeking clarity on the issue and even pitching for deferment of the new levy.