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HomeBusinessGST liability on transport and restaurant service on e-commerce companies from January...

GST liability on transport and restaurant service on e-commerce companies from January 1

New Delhi, Dec 26 (PTI) From January 1, the Goods and Services Tax (GST) system will see several changes related to the tax rate and procedure. These include tax liability on e-commerce service providers on services provided in the transportation and restaurant sectors.

Apart from this, changes in the duty structure in the footwear and textile sector will also come into effect from January 1, 2022, under which all types of footwear will attract 12 percent GST (Goods and Services Tax) while all textile products (except cotton) including readymade garments will attract 12 percent. GST will be applicable.

Auto rickshaw drivers will continue to get exemption on passenger transport services provided by offline mode, but when these services are provided through an e-commerce platform, they will be taxed at the rate of five per cent from the new year.

Under the procedural changes, it will be the responsibility of e-commerce service providers like Swiggy and Zomato to collect GST for restaurant services provided by them and deposit the same with the government. They will also have to issue bills for such services.

This will not put any extra burden on the consumer as the restaurants are already collecting GST revenue. The only change that has happened is that the responsibility of depositing taxes and issuing bills has now shifted to the food supply forums.

The move was taken as the government estimates that the exchequer has suffered a loss of around Rs 2,000 in the last two years due to alleged non-disclosure of information by the food supply forums and making these forums liable to deposit GST. Tax evasion will be stopped.

Some more steps will be taken in the new year to check tax evasion. These include making Aadhaar verification mandatory for getting GST refunds, blocking GSTR-1 filing facility for businesses that have not paid taxes, etc.


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