Bad news for Indian foodies: Zomato and Swiggy deliveries can cost more
The GST council will meet on Friday, September 17 to decide to add goods and services tax (GST) to app-based online grocery delivery services. The news is not a welcome development for the thousands of Indians who regularly order from app-based food delivery services like Zomato and Swiggy. The proposal, which could lead to increasingly expensive food orders, is on the agenda of the GST Council this week.
The proposed addition was made by the GST board meeting committee. According to the committee's proposal, a circular should clarify whether home delivery or takeout service from cloud kitchens / central kitchens falls under “catering service”. are reported as reputable suppliers or aggregators.
If the municipality chooses the “approved supplier” option, the ECAs are classified as such into two categories. The suggestions here are a tax rate of 5% with no input tax deduction and 18% with withholding tax on ECO or 5% with limited input tax deduction from 'ECO to the customer'. The rate is set out later in the proposal for naming OCUs as aggregators.
With the entry into force of the ruling, all grocery deliveries will be subject to GST, which will require online delivery services to pay.
Sources:- DNA India
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