The Directorate General of GST Intelligence (DGGI) has issued Goods and Services Tax (GST) demand notices totaling Rs 750 crore to food aggregators Zomato and Swiggy. The notices state that these companies owe Rs 400 crore and Rs 350 crore, respectively, in GST payments, as reported by CNBC TV-18.
The DGGI argues that since food delivery is a service, Zomato and Swiggy are obligated to pay GST. However, the companies believe that the ‘delivery charge’ they collect from customers is the amount incurred by the delivery partners and is subsequently passed on to them. This distinction in interpretation is the crux of the dispute.
Earlier, in 2022, Swiggy and Zomato were instructed to collect and remit tax at a rate of 5 percent on their orders. Prior to this, restaurants registered under GST were solely responsible for collecting and paying the tax.
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