Get Ready for Higher Bills: Zomato and Swiggy to Introduce New Charge Soon

New Delhi (The Uttam Hindu): Customers ordering food from online food delivery platforms Zomato and Swiggy may soon get a big shock. After an important decision of the GST Council, now these companies will have to pay 18% GST on delivery charges as well, which will put an additional burden of Rs 180-200 crore on them every year. The companies have clearly indicated that they will not bear this burden alone, but will put it on customers and delivery partners.

What is the whole matter?

The GST Council has made it clear that 18% GST will be applicable on the delivery charges levied by online marketplaces. Till now this tax was not directly applicable on delivery partners, due to which companies were avoiding this liability. After this decision, the cost of companies has increased drastically. According to sources, Zomato and Swiggy are working on a dual strategy to compensate for this additional cost. Under this, either the earnings of delivery partners will be cut or a new 'service levy' will be charged from customers on every order.

Companies will not bear the burden

According to a report by Economic Times, a senior Zomato official said on the condition of anonymity, "This burden of tax will not be borne entirely by the company. It will be recovered partly from the earnings of delivery workers and partly from customers." Swiggy has also confirmed to adopt a similar strategy.

This dispute is not new. Earlier in December 2024, Zomato received a notice from the tax authorities for outstanding taxes and penalties of Rs 803 crore. Swiggy also faced similar liability. Now this new clarification from the Council has made the picture completely clear.

Prices are sure to increase

Experts believe that this decision will not only affect food delivery but also the quick commerce sector. The offer of free or cheap delivery given till now to attract customers may end and customers may have to pay additional charges including 18% GST on every order. Brokerage firms have also called it a negative sign for both the companies, although they believe that the companies will put this burden on customers and partners to reduce the impact on their profits.