Swiggy, Zomato to pay GST on restaurant service supplied through them: FM

GST Council decides to continue keeping petrol, diesel out of GST purview

By Jasleen Kaur -- September 17, 2021 9:09 pm -- Updated:Feb 15, 2021

Finance Minister Nirmala Sitharaman, after a meeting of the GST Council in Uttar Pradesh's Lucknow on Friday, said food delivery apps such as Zomato and Swiggy must pay GST, instead of the restaurant they pick up orders from.

At present, these apps are registered as TCS, or Tax Collected at Source, in GST records.

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The GST Council decided to continue keeping petrol and diesel out of the GST purview. Nirmala Sitharaman said 5 per cent GST will be levied at the point where the delivery is made by Swiggy and Zomato. "Regarding Swiggy-like operators, it has been decided that since the place where food is delivered will be the point where tax is collected, the Swiggy-like operator who will be collecting tax will pay up the GST on it," said Sitharaman in Lucknow.

It was the GST Council's 45th meeting and the first in a physical format since the Covid-19 pandemic outbreak.

The GST Council cut GST rate from 12 per cent to 5 per cent on cancer-related drugs and on fortified rice kernels to 5 per cent from 18 per cent.

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GST rate on bio-diesel for blending in diesel was reduced to 5 per cent from 12 per cent, while the national permit fee for goods carriage has been exempt from GST. Import of leased aircraft had also been exempted from payment of I-GST, the Finance Minister said.

The GST Council also recommended new footwear and textile rates from January 1. GST payable on import of aircraft or other goods imported on lease shall now be exempted from double taxation.

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Transport of export goods by vessels and air was exempt from GST till September 30. This exemption was given because of difficulties being faced by exporters in getting a refund of ITC (Input Tax Credit) due to technical issues on GST portal. This exemption is being extended by one more year, said the Finance Minister.

Key decisions taken by the GST Council:

  • Pens to attract single GST rate of 18%, 12% GST on specified renewable sector devices.
  • GST Council cuts tax rates on medicines used in cancer treatment from 12% to 5%
  • GST rate on biodiesel for blending with diesel cut from 12% to 5%
  • GST Council exempts national permit fee charged by states for operation of goods carriage
  • GST Council agrees to correct inverted duty structure on footwear and textiles from Jan 1, 2022
  • GST on retro-fitment kits for vehicles used by divyang or persons with disabilities reduced to 5%
  • GST rate on fortified rice kernels which can be used in schemes like Integrated Child Development Services Scheme has been reduced from 18% to 5%.
  • Training programmes wholly funded by state/Central Govt exempt from GST
  • GST Council also has granted exemptions to many life-saving drugs used to treat children-PTC News with inputs from agencies