New 18% GST on delivery charges to further raise order costs starting September 22
Ordering food online is about to become more expensive for millions of Indian consumers, as top delivery platforms Zomato, Swiggy, and magicpin have increased their platform fees in the lead-up to the festive season. In addition, a new 18% Goods and Services Tax (GST) on delivery charges will come into effect from September 22, adding to the overall cost per order.
Fee Hikes Across Platforms
- Swiggy has reportedly raised its platform fee to ₹15 per order (inclusive of GST) in select markets.
- Zomato has increased its fee to ₹12.50 per order (excluding GST).
- Magicpin, while also hiking its fee, remains the most affordable among the three at ₹10 per order.
With the upcoming GST changes, users are expected to pay an additional ₹2 to ₹2.6 per order depending on the platform, further tightening household budgets during a typically high-consumption period.
Magicpin Maintains Price Advantage
In a statement to PTI, a magicpin spokesperson clarified that the new GST rule would not impact its pricing model:
“Recent GST changes do not impact our cost structure. Thus, for consumers, there would be no change in pricing. Our platform fee remains ₹10 per order — the lowest among leading food delivery services.”
Why Platform Fees Matter
Platform fees have evolved into a critical revenue stream for food delivery companies, particularly as they strive for profitability in a competitive and capital-intensive sector. What started as a nominal charge has steadily increased over time.
An analyst at Elara Securities told Storyboard18 that the trend of raising platform fees ahead of peak seasons has been ongoing:
“Zomato, for instance, raised its platform fee from ₹6 to ₹10 last festive season. This year’s hike continues that pattern and is likely being tested in Tier-I markets before a broader rollout.”
Since its introduction, Zomato’s platform fee has reportedly increased six-fold, highlighting a strategic shift toward consumer-pays pricing models.
Industry Outlook
Despite rising costs, India’s food delivery sector remains on a strong growth trajectory, with analysts projecting over 20% growth over the next two to four quarters, driven by increased digital ordering and festival demand.
Still, for everyday users, the cumulative impact of higher platform fees and new taxes could prompt greater price sensitivity – and a potential rethink of smaller or more frequent orders.
Quick Take: What’s Changing?
| Platform | New Platform Fee | GST Impact | Total Cost Increase (Approx.) |
|---|---|---|---|
| Swiggy | ₹15 (incl. GST) | +₹2.6 | ~₹17.6 per order |
| Zomato | ₹12.50 (excl. GST) | +₹2.25 | ~₹14.75 per order |
| Magicpin | ₹10 (fixed) | No change | ₹10 per order |
As festive demand builds, users may find their convenience comes at a steeper price – even as platforms balance profitability with user retention in a growing but sensitive market.
