Swiggy, Zomato to collect 5% GST from customers starting 1 Jan, 2021; here’s how much you will have to pay

Nirmala Sitharaman made the announcement after the GST Council assembly, which has made the choice for ease in tax administration.

Meals supply apps like Swiggy and Zomato will accumulate 5 p.c Items and Providers Tax (GST) from shoppers as an alternative of the restaurant they decide up orders from, beginning 1 January 2022. Nonetheless, prospects won’t need to pay additional for getting their meals delivered.

Finance Minister Nirmala Sitharaman made the announcement on Friday, 17 September, after the assembly of the GST Council in Lucknow. The Council has made the choice for ease in tax administration.


Sitharaman stated that the client could be “the purpose on which tax can be collected by the gig teams Swiggy and others.” These apps are registered as Tax Collected at Supply or TCS in GST data presently.

Income secretary Tarun Bajaj was fast to make clear that the client wouldn’t be impacted adversely by the change. He stated that there was no new tax being levied, however a easy switch of the GST assortment level.

Bajaj defined that as an alternative of GST being levied on eating places, who then submit it to the federal government, the tax could be collected from the shoppers and paid to the authorities. Based on Bajaj, the choice was made to stop “income leakage” by unregistered eating places. Meals supply aggregators like Zomato and Swiggy don’t do a compulsory registration verify on meals supply suppliers on their app.

The evaluation of returns filed by the supply apps and a few Haryana restaurant providers indicated a spot in taxable turnover for suppliers, implying tax evasion on the a part of some eating places. The evaluation confirmed instances, the place the TCS deducted by a supply app, was greater than turnover declared by such suppliers.

Based on estimates, the alleged underreporting by meals supply aggregators has induced the Exchequer a lack of Rs 2,000 crores within the final two years.

The GST Council additionally made different vital bulletins. Sitharaman was agency that petrol and diesel wouldn’t be introduced below the ambit of GST presently.

In different bulletins, the GST was waived on import of sure extremely costly medicines for muscular atrophy. The concessional GST charges on medication utilized in treating COVID-19 remedy was prolonged until 31 December.

Leave a Comment