The government has mandated an 18% Goods and Services Tax (GST) on delivery services—impacting food delivery platforms like Zomato, Swiggy, and Blinkit—as part of GST Council clarifications. The change, effective September 22, 2025, subjects delivery fees to GST even when these are classified as pass-through expenses under Section 9(5) of the CGST Act.
Delivery platforms now face an additional tax burden estimated at ₹180–200 crore annually. In light of this cost, companies may shift the burden to delivery partners or customers, potentially reducing driver earnings or raising consumer fees.
Analysts estimate that, per order, the GST impact could translate to around ₹2 extra for Zomato and ₹2.6 for Swiggy, with smaller impact on Instamart orders. Blinkit, already collecting GST on delivery, may see minimal change.
Delivery services now fall under the same 18% GST bracket as courier and logistics, aligning them with other fee-based services rather than essential or B2C categories.
Why It Matters
- Increased Operating Costs for Platforms
Zomato, Swiggy, and Blinkit now face a hefty GST-related expense, which could shrink margins unless offset through price increases or cost cuts. - Potential Pricing Impact on Consumers
While per-order increases may seem small, the cumulative cost could make frequent ordering noticeably more expensive—especially during the high-demand festive season. - Delivery Partner Earnings Could Fall
Platforms might reduce delivery partner pay to compensate for the additional tax burden—a move that raises questions about labor impact. - Policy Tightens Tax Compliance
The new ruling closes a long-standing loophole, reinforcing stricter tax compliance for platform-based delivery services.
