The Central Board of Indirect Taxes and Customs (CBIC) has clarified that the 5% Goods and Services Tax (GST) on delivery services provided through e-commerce platforms represents a reduction in the tax rate, rather than the introduction of a fresh levy.
The clarification came in response to a post on X claiming that the GST Council had proposed a 5% GST on e-commerce deliveries across all modes of transport. The post also questioned whether the move would affect delivery charges paid by online shoppers.
Responding through its official account, @cbic_india, in a reply dated October 10, CBIC stated that the post had omitted important context about the earlier tax treatment of these services.
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What The Original Post Claimed
The post, shared by an X user named Sohail, stated that the GST Council had proposed a 5% GST on e-commerce deliveries across all modes of transport.
An accompanying graphic depicted deliveries by air, rail, road, sea and two-wheelers, alongside packages bearing the names of prominent e-commerce platforms. Its headline presented the proposed 5% rate without explaining the earlier rate applicable to delivery services.
The post then asked whether the development would affect delivery charges for online shoppers.
CBIC Explains The Earlier 18% Rate
CBIC responded that delivery services, including those provided by food apps, were previously taxed at 18%.
According to the Board’s reply, the tax on these delivery services has now been reduced to 5%, following the recommendation made at the 57th GST Council meeting.
CBIC further stated that all delivery services provided through e-commerce platforms are now taxed uniformly at 5%. Its clarification therefore addressed the impression that the announcement involved imposing a new tax on an activity that had previously been untaxed.
“So, there is no new imposition of tax. Rather, there is a reduction in tax,” the Board stated in the reply reproduced in the supplied screenshot.
CBIC concluded by asking the user to describe the position accurately.
A 13-Percentage-Point Reduction
The change described by CBIC brings the rate down by 13 percentage points, from 18% to 5%.
For illustration, on a taxable delivery-service value of ₹100, GST at 18% would amount to ₹18, while GST at 5% would amount to ₹5. Assuming the underlying charge remains the same, the tax-inclusive amount would fall from ₹118 to ₹105.
This example illustrates the effect of the rate reduction on the delivery-service component. It does not establish what any particular platform will charge customers.
What Does The Clarification Mean For Online Shoppers?
The original post raised a consumer concern about whether the 5% rate would increase delivery charges. CBIC’s response explains that the change should be understood against the earlier 18% rate, rather than treated as an additional tax burden.
However, the reply does not announce any platform-specific reduction in delivery fees or guarantee a particular decrease in customers’ final bills. The amount paid by a customer will also depend on the underlying delivery charge, discounts and other charges appearing on the invoice.
The clarification concerns the tax treatment of delivery services supplied through e-commerce platforms. It does not state that every product purchased online will attract GST at 5%.
Accurate Presentation Of The Tax Change
The central point of CBIC’s response is that reporting the 5% rate without mentioning the previous 18% rate can create an incomplete impression of the change.
By responding directly to the post, the Board sought to explain that the measure reduces the applicable tax on the delivery services it described and introduces a uniform 5% rate across delivery services provided through e-commerce platforms.
