Zomato, Swiggy food delivery to come under GST: But customers won't pay more

New Delhi, Sep 17: Online food-delivery businesses such as Zomato and Swiggy will have to pay GST on restaurant services provided through them, and the tax will be levied at the point of delivery.

However, there will be no new taxes, instead the GST collection point was simply being transferred. The tax was formerly paid by eateries, but will now be paid by aggregators.

"Suppose you order food from the aggregator... now the restaurant is paying taxes. But we found some restaurants were not paying. We are now saying that if you order the aggregator will collect from the consumer and pay to the authorities instead of the restaurant doing this..." Revenue Secretary Tarun Bajaj said.

"There is no new tax..." Bajaj added.

As of now, online bills created by food aggregators include a tax component. The taxed sum is transferred back to the restaurant partners, who are then expected to pay the government.

If this proposed amendment is approved, the firms will no longer pay the eateries but will instead pay the government directly.

As food items are taxed at different rates, it will be interesting to watch if the government makes place for an universal 5% tax on food delivery by these aggregators.