InvestorQ : Is it true that Zomato and Swiggy will start collecting the 5% tax from January 2022?
Mitali Bhutta made post

Is it true that Zomato and Swiggy will start collecting the 5% tax from January 2022?

Answer
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4 months ago
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That is absolutely correct. In fact, effective from 01-January 2022, these food aggregators like Swiggy and Zomato are mandatorily required to collect and deposit tax at 5% of the order value as tax on food vendors. Till Dec-21, food aggregators were outside the purview of GST, but with the new rule, they come under 5% GST bracket. This puts them at par with the restaurants registered under GST that are collecting and depositing the tax.

Let me also add that this not only applies to food aggregators but also to cab aggregators like Ola, Uber will also have to collect 5% GST and deposit with the government. In what could complicate matters for ecommerce operators, they will be required to obtain GST registration in each State where restaurants are located. This is likely to widen the tax base as food vendors are currently outside the GST threshold. This will add to costs.

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