Starting September 22, 2025, ordering food or groceries through popular platforms like Swiggy, Zomato, Blinkit, and others is likely to get more expensive.
The GST Council, during its 56th meeting on September 3, announced that an 18 per cent Goods and Services Tax (GST) will now be levied on delivery charges under the new GST framework. Previously, these delivery fees were exempt from GST. But with the updated tax regime, platforms operating as Electronic Commerce Operators (ECOs) will now be liable to pay GST on local delivery services, as per the new inclusion under Section 9(5) of the CGST Act. What Will This Mean for Customers? The immediate impact of this move is likely to be felt by end-users. As one senior executive at a food delivery firm told the Indian Express, “We would have no other option but to pass on that hit to customers, so you can expect delivery fees going up, or even delivery partner earnings taking a hit. The cost of food could also go up.” To illustrate, if a customer orders food worth Rs 1000, they’re already paying restaurant GST (approx. Rs 176), a platform fee (around Rs 30, inclusive of GST), plus packaging charges. With the new GST 2.0 possibly taxing delivery services separately, the final bill could climb even higher, especially if platforms pass the added cost to users. How Are Companies Responding? Reports suggest that major delivery and quick-commerce platforms are currently evaluating how the new tax will affect their operating margins. Many are leaning towards passing the additional cost to consumers to avoid losses. What's Behind The GST 2.0 Decision? The GST Council’s move is part of a broader effort to rationalise tax collection under GST 2.0. By bringing delivery services under the tax net, the government aims to close loopholes and improve revenue collection. This change affects a wide array of companies beyond just Swiggy and Zomato; players like Zepto, BigBasket, Instamart and Dunzo are also covered under the new rules. Meanwhile, at the 56th meeting of the GST Council, held recently, a significant overhaul of the tax structure was announced. The existing four-tier system has been streamlined into a more simplified two-tier framework, featuring a standard GST rate of 18 per cent and a lower rate of 5 per cent. Additionally, a demerit rate of 40 per cent will be applied to a limited set of goods and services deemed non-essential or harmful.
