Zomato and Swiggy are set to bear an additional annual GST burden of ₹180–200 crore after the government clarified that delivery charges fall under the 18% Goods and Services Tax (GST) category. The GST Council’s decision takes effect from September 22, 2025, and applies to delivery fees even when collected as pass-through expenses under Section 9(5) of the CGST Act. Economic Times
Industry experts estimate that the tax will add about ₹2 per order on Zomato and ₹2.6 per order on Swiggy, depending on the basket size. While these numbers appear small, the volume of daily orders handled by the platforms means the costs will quickly accumulate. Blinkit, already charging GST on delivery, may see minimal impact.
Both companies are exploring ways to handle the burden, with analysts suggesting they may either pass the tax onto customers through higher delivery fees or reduce delivery partner commissions. Either move could impact demand and supply dynamics in India’s competitive food delivery market.
Why It Matters
- Massive Tax Outgo: The ₹180–200 crore GST liability could directly eat into Zomato and Swiggy’s margins.
- Higher Consumer Prices: Customers may end up paying slightly more per order, raising the cost of frequent food delivery.
- Impact on Gig Workers: If platforms cut delivery partner payouts to absorb costs, earnings for gig workers could fall.
- Investor Concerns: Rising expenses and potential demand slowdown could worry investors during the festive season.
