45th GST Council Meeting — Swiggy/Zomato Tax & Textile Rates

The most significant change: E-commerce food delivery operators (Swiggy, Zomato, Uber Eats successors) became liable to collect and remit GST at 5% on restaurant food deliveries from 1 January 2022. Previously, the restaurant was supposed to pay GST. Problem: Many small restaurants and cloud kitchens operating via apps were unregistered, leading to massive revenue leakage. Solution: Make platforms the 'deemed supplier' — they already collect payment, so they now collect tax too. Important: This does NOT increase the tax on consumers. The rate remains 5% on restaurant food. Only the mechanism changed — platforms pay instead of restaurants. This brought lakhs of unregistered cloud kitchens into the tax net.

The 45th Meeting APPROVED increasing textiles and footwear to a uniform 12% GST (from the existing split: <₹1,000 at 5%, >₹1,000 at 12%), effective 1 January 2022. Reason: Inverted duty structure — yarn/fabric inputs taxed at 12-18% but finished garments at 5% = manufacturers accumulate ITC and claim refunds (₹7,000 Cr refund burden). However: This was DEFERRED in the very next meeting (46th Meeting, 31 Dec 2021) after massive opposition from textile manufacturing states (Gujarat, Tamil Nadu, West Bengal). The rate increase never took effect.

Solar cells/modules, wind-operated electricity generators, and related parts moved from 5% to 12%. Context: (1) The 5% concessional rate was introduced in 2017 to promote green energy adoption; (2) By 2021, the industry matured — solar costs dropped 80% in 5 years; (3) Domestic solar manufacturing was getting hurt — imports at 5% made domestic products (taxed at higher input costs) uncompetitive; (4) Basic Customs Duty on solar imports was also being introduced; (5) The increase aligned with the Atmanirbhar Bharat push. Industry initially protested but accepted after seeing the broader manufacturing incentives (PLI scheme).

FRK are specially manufactured rice grains fortified with iron, folic acid, and vitamin B12. The government distributes them through ICDS (Integrated Child Development Services) and MDM (Mid-Day Meal) schemes to combat malnutrition. The 45th Meeting exempted FRK from GST when supplied to these government programs — making the nutrition program cheaper. This aligns with the PM's Independence Day 2021 announcement of rice fortification across all government schemes by 2024. Only government program supplies are exempt — commercial FRK sales remain taxable.

The 45th Meeting was held on 17 September 2021 in Lucknow, Uttar Pradesh. Notable context: (1) First physical meeting after the devastating COVID second wave (April-June 2021); (2) Held in UP just months before the critical UP state elections (Feb 2022); (3) Previous meetings (43rd, 44th) were held virtually due to COVID; (4) The meeting lasted a full day with extensive discussions on textile rates and Swiggy/Zomato tax. The FM held a detailed press conference afterward explaining the food aggregator decision.