Now you have to pay 5% GST on all rides purchased online!
The Union government has decided to levy a 5% GST on all rides purchased online and this is going to happen from January 1, 2022.
Now when you book your cabs or auto from the apps like Ola and Uber, expect to pay more for the services you use.
In a statement, the Revenue Department, which is part of the Finance Ministry, cancelled the GST exemption for auto-rickshaws that provide passenger transportation services on online platforms.
What Does Uber Have To Say About This?
According to Uber, a Spokesman told The Times of India., the move is a necessity and they understand that government has to collect revenue but still Demand a reconsideration of the move. as the move will damage vehicle drivers’ wages as well as the government’s digitalisation strategy.
“The Union government has declared that it will levy a 5% GST on auto rides booked online from January 1, 2022, ending an existing exemption. Auto rides taken from the streets will continue to be GST-free. “
“We urge the government to reinstate the GST exemption for online auto products in the ride-sharing industry to ensure riders, drivers and cities can keep benefiting from the growth in this sector,” he added.
Impact Of COVID-19 On Ride-Hailing Business
Given the new policy being initiated by the government, the impact on the overall ride-hailing business would be quite adverse for both driver and riders.
“This policy might lower the rate of consumers opting for auto rides, further making commuting less feasible and hassle-free,” he added.
Aravind Sanka, co-founder of Rapido.
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