The Goods and Service Tax (GST) Council on Friday approved the proposal of bringing e-commerce operators under GST ambit for providing certain service. The e-commerce operators will be liable to pay tax for providing following services a) Transport of passengers, by any type of motor vehicles through it, b) Restaurant services provided through it with some exceptions. Food delivery aggregators such as Zomato and Swiggy will have to pay GST for supplies made by them. The changes is going to come into effect from January 1, 2022 to allow e-commerce operators to make software changes.
The food delivery apps will have to collect and deposit GST with the government, for deliveries made by them. Currently, online bills generated by food aggregators already have a tax component in it. However this taxed amount is paid back to the restaurant partners who are then expected to pay this amount to the government.
“The decision to make food aggregators pay tax on supplies made by restaurants from January 1, 2022 seems to have been done based on empirical data of under reporting by restaurants, despite having collected tax on supplies of food to customers,” said Mahesh Jaising, Partner, Deloitte India.
How it is Going to Affect the Customers:
You may have to shell out more for ordering food via delivery platforms such as Swiggy and Zomato. Clarifying the charges on Zomato and Swiggy, Jaising mentioned, “The impact on the end consumer is expected to be neutral where the restaurant is a registered one. For those supplies from unregistered, there could be a 5 per cent GST going forward. Details on this are awaited.”