GST meet: Online food orders to get costly, petrol not under tax regime

Ordering food may become costlier as the GST Council on Friday approved the proposal of treating food delivery apps such as Zomato and Swiggy as restaurants. It also decided that the time was not right to bring petroleum products such as petrol and diesel under the GST purview.

Finance Minister Nirmala Sitharaman addressed the media after chairing the 45th meeting of the Goods and Services Tax (GST) Council in Lucknow – the first in-person meeting of the panel in nearly two years.

A 5% GST on supplies made by food delivery apps was proposed, a report in News18 quoted sources as saying, and if the food aggregators pass on that extra charge to customers, ordering food online will cost more.

Currently, the tax charged on online orders are sent back to the restaurants who are then expected to pay this to the government, according to people privy to the matter.

West Bengal Finance Minister Chandrima Bhattacharya said the issue of GST on Swiggy, Zomato has been referred to the GoM.

The other announcements on the day’s deliberations include:

• Hike in GST rates from 12 per cent to 18 per cent on locomotives, certain railway parts;
• GST exemption on expensive imported drugs like Zologensma and Viltetso which are unrelated to COVID
• Tax rates cut on medicines used in cancer treatment
• Extension of concessional GST rates on COVID-related drugs, which were allowed till September 30, till the end of the year.
• UPS & external battery to be treated at par. Current GST levy on UPS is 18 per cent, external battery at 28 per cent
• 12% GST will be applicable on specific renewable devices
• Inverted duty scheme on footwear and textiles will be corrected from January 1, 2022
• GST rate on fortified rice kernels which can be used in schemes like Integrated Child Development Services Scheme has been reduced from 18 per cent to 5 per cent
• GST on retro-fitment kits for vehicles used by Divyang/Persons with Disabilities reduced to 5 per cent

The Council also approved several of the proposals made by the Fitment Committee.