Will bringing Swiggy, Zomato under GST increase price of food ordered online?
Kochi: Even though the GST Council brought food delivery platforms like Zomato and Swiggy under the GST purview, the net price of the food ordered online will not change.
The Council, which is headed by the union finance minister and includes representatives from all states and UTs, on Friday decided to charge services by cloud kitchens and food delivery platforms like Zomato and Swiggy a 5 percent GST.
From January 1, food delivery apps will have to collect and deposit 5 percent GST with the government, in place of restaurants, for deliveries made by them.
"Food delivery operators like Swiggy who collect orders from restaurants and deliver (to customers)... the place where the food is delivered will be the point on which tax will be collected by the big groups Swiggy and others," Union Finance Minister Nirmala Sitharaman said.
Revenue Secretary Tarun Bajaj added, "There is no extra tax, there is no new tax. The tax was payable by restaurants, now instead of restaurants, the tax will be payable by aggregators which will also... prevent revenue leakage."
The government has noticed tax evasion by some restaurants in online delivery. This system hopes to overcome it.
The delivery platforms charge up to 30 percent as commission. Kerala Hotel and Restaurants Association president M Moideenkutty said the customer has to bear the burden of the GST and delivery charges additionally.
(With inputs from agencies)