#Watchnow #Inaminute video where Jatin Arora, Partner, Phoenix Legal takes us through this GST Council update in relation to e-commerce operators.

GST Updates 2021 – In the 45th GST Council meeting, it was decided to shift the burden of tax on the restaurant services to e-commerce operators like #Swiggy#Zomato through whom these services are delivered. In the video, Jatin quickly explains what this update is about and the impact that it is likely to have on e-commerce operators.

He takes us through the details that this is not a new tax introduced on e-commerce operators. The restaurant charges 5% GST on their supplies. Also, the e-commerce operators pay 18% GST on the commission earned by them.

This will be in effect from 1st January 2022 and instead of the restaurants, the e-commerce operators will charge the tax on the food supplies. The e-commerce operators will charge GST on every supply that they will make, irrespective of whether the restaurant supplying the food is exempt from GST or not. This means there will be additional burden on compliance side for restaurants. The e-commerce operators will also have to do changes in their software to accommodate this change and do additional compliance.

An important issue to be considered is that the restaurants are not eligible to avail input tax credit (ITC) for their supplies. Whereas the e-commerce operators do avail ITC. For more clarity on these points, we need to watch out for the notifications issued by the government.

Stay tuned for more GST updates happening in 2021

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