Food Delivery Apps vs Restaurant's Own Delivery: How GST 2.0 Will Affect Your Bill

As of September 22, 2025, food delivery apps such as Zomato and Swiggy will need to apply an additional 18% GST on delivery fees, over and above the existing 5% GST on food orders. The GST Council has confirmed that local delivery services fall under Section 9(5) of the CGST Act, removing ambiguity around whether such charges should be taxed. The decision leaves platforms with a choice: absorb the cost, pass it on to customers, or adjust delivery partner payouts. At the same time, reports suggest that quick-service restaurants (QSRs) could gain an advantage from other GST changes.

Also Read: GST Rates On Food Revised: All Your Questions Answered

GST Rates On Food Delivery: Core Changes

How Much More Could An Order Cost?

Estimates from market analysts give a feel for the per-order impact if platforms pass the tax on to customers:

Note: These are approximate figures from market reports and Morgan Stanley calculations quoted in media coverage. Actual impact will depend on whether platforms absorb, partially absorb, or pass on the levy.

We reached out to Swiggy and Zomato. Both have chosen not to comment at present.

Also Read: New GST Rates: How Much Will You Save On Your Next Restaurant Bill?

Who Bears The Burden - Platforms, Customers Or Delivery Partners?

Platforms face three blunt options:

• Absorb the tax and trim margins (unlikely given already-thin economics).

  Raise customer bills (raise the delivery fee or show a separate GST line).

  Reduce payouts to delivery partners (which would squeeze gig earnings).

Industry chatter and analyst notes suggest firms will mix responses - small increases in fees plus operational levers like higher platform fees or targeted pricing changes. Companies have already been tinkering with platform fees in recent months.

Do Restaurants That Deliver Themselves Gain An Advantage?

Yes, restaurants that use in-house delivery fleets (for example, Domino's, Pizza Hut, McDonald's and KFC) are effectively outside the food delivery charges faced by Swiggy, Zomato, etc. Their customer bills remain subject to the standard food GST treatment (5% under the revised rules), and they do not have a separate 18% GST on delivery fees levied through a food delivery app. As an industry source told The Indian Express: "For Domino's and other similar restaurants with their own delivery network, the tax position has not changed, whereas for Zomato and Swiggy, the tax position was unclear whether GST is applicable on delivery separately or not. Now, it is clear that GST is applicable." This means ordering directly from a chain that runs its own logistics could be modestly cheaper on the tax line than ordering the same pizza through a marketplace.

Why QSRs (Quick-Service Restaurants) May Actually Win Here

The GST rationalisation is a two-sided move. While platforms take a hit on delivery charges, QSR chains are set to benefit because many of their raw materials and packaging inputs (such as cheese, butter, sauces, paneer, bread, and certain packaged foods) have been shifted to lower GST rates - often 5%. QSRs typically cannot claim input tax credit (ITC) for many items; GST on inputs is therefore a direct cost. Lower GST on inputs improves gross margins immediately, and analysts expect part of that gain could be passed to customers to stimulate demand. Bernstein and several market reports flag QSRs as one of the key beneficiaries of the reshuffle.

Quick Checklist For Consumers

• Expect small increases in delivery fees if platforms choose to pass on the tax. See estimated numbers above.
• Ordering directly from a restaurant that runs its own delivery fleet may avoid the extra 18% on delivery fees; food will continue to attract the revised 5% GST where applicable.

To learn more about the revised GST rates on food and drink, click here.