GST on delivery fees: meaning, how it works in India and examples

GST on delivery fees is the Goods and Services Tax charged on the delivery charge a customer pays on an app such as a food ordering or quick-commerce platform. The delivery charge pays for the service of bringing the order to the customer's door. It is separate from the price of the food or groceries.

The change that drew attention in 2025 was about who must pay the tax. Gig delivery partners usually earn too little to register for GST, so earlier no one was collecting it. The 56th GST Council meeting in September 2025 moved local delivery through an app into a rule that makes the platform responsible.

Section 9(5) of the Central GST Act lets the government notify certain services supplied through an e-commerce operator as services for which the operator itself pays the tax, as if the operator supplied them. Ride-hailing and some housekeeping services are older examples of this rule.

From 22 September 2025, as reported by news outlets and advisers, local delivery services provided through an e-commerce operator were brought under this rule. The rate is 18%. In effect, the platform becomes the one that collects and pays the GST to the government on the delivery component, and the delivery partner does not.

Under the rule as summarised, the platform pays the tax to the government when the delivery partner is not registered for GST. If a partner is registered, that partner is responsible instead, according to the same summaries. Most gig partners are not registered, so for most orders the platform is the one remitting.

Legally the tax is on the platform. Economically, who bears it is a business decision. The platform can add it to the customer's bill, absorb it, or try to adjust what it pays delivery partners. Outlook Business reported an estimated annual burden of ₹180 to ₹200 crore each for Zomato and Swiggy, and the CFO of Zomato's parent Eternal later said the company passed the 18% on to customers, which he said affected growth. These are reported figures, not audited ones.

A customer who orders food now often sees a delivery fee and GST on that fee as a separate line, together with the existing line items such as platform fee or packaging charge. The GST on food itself follows the rate for restaurant services and is a separate matter.

Quick-commerce orders work a little differently in practice. Some commentary treats delivery on a grocery order as part of the supply of goods, because the delivery is tied to the goods, while for food platforms delivery is the core service. How a given platform splits fees on the invoice should be read from its tax invoice.

A delivery fee of ₹30 now carries ₹5.40 of GST at 18%. If the customer bears it, the bill rises. If the platform absorbs it, contribution per order falls, and on a ₹400 average order that is more than one percent of order value.

Platforms have several levers: raise the delivery fee, change the minimum order for free delivery, add or adjust a platform fee, or negotiate with restaurants and delivery partners. Each lever has a cost in demand, and quick-commerce players with thin margins and high order frequency feel it more.

Any startup that arranges local delivery through its own app and counts as an e-commerce operator may be affected, including food delivery, grocery, pharmacy and hyperlocal logistics apps. Examples that readers often see in news are Zomato, Swiggy and Blinkit, whose results commentary has discussed the effect.

A startup that delivers its own goods through its own fleet, and sells on its own website, may not be an e-commerce operator for this rule. The exact classification depends on how the business is set up, so it should be checked with a tax adviser.

A founder running a delivery app, or a seller on one, should test a few points before the next filing.

• Whether the platform counts as an e-commerce operator for the delivery service.
• Whether delivery partners are registered, because that decides who pays.
• Whether the invoice splits delivery, platform and packaging fees correctly.
• Whether the 18% is passed to customers, and how that is stated in terms and conditions.
• Whether any input tax credit is available on related costs, which an accountant should confirm.

Reports in September 2025 said platforms might offset part of the tax cost by changing what they pay delivery partners per order. A Free Press Journal report described such a plan, though whether and how it happened differs by platform and city. This is a point of friction, because the tax is meant to be paid by the platform and not to reduce the partner's earnings.

A reader should treat any claim about partner pay with care. Company statements, partner unions and press reports can disagree, and payout structures include base pay, incentives and distance components that change often. For the wider picture of how gig work is regulated, see the separate guide on gig worker social security.

Small per-order amounts add up quickly. A platform that delivers several crore orders a quarter and collects a fee on most of them is handling a tax line of tens of crores. That is why the reported estimate of ₹180 to ₹200 crore each for the two largest food apps drew attention, and why analysts asked how much was passed to customers.

Margin effects also depend on mix. Orders with free delivery have no fee to tax, while orders with surge or small-basket fees carry more. Quick-commerce platforms that earn mostly through the margin on goods and advertising may see the delivery-fee tax as a smaller part of their economics than food platforms, where the fee is a larger share of revenue per order.

GST 2.0 changed the rate slabs on goods and services. The delivery rule changed who is responsible for a service whose rate was already 18%. Both took effect on 22 September 2025, which is why the two stories are often mixed. A reader should treat them as separate decisions.

This guide is general information as of November 2026, not legal or tax advice. Confirm treatment against the CBIC notification and with a professional.