For a notified passenger-transport service supplied through an e-commerce operator, the platform—not automatically the driver or passenger—is liable to pay GST under section 9(5) of India’s CGST Act. The key question is whether the ride service is supplied through the platform. Who collects or receives the fare does not, by itself, decide who must remit the tax.
Who is legally responsible for paying GST on an app-cab ride?
Section 9(5) of the CGST Act places the GST liability on an e-commerce operator for specified services supplied through it. For those services, the operator is treated as the supplier liable for the tax. The Central Board of Indirect Taxes and Customs (CBIC) explains this rule in its Sectoral FAQ.
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Passenger transport by motorcab, maxicab, motorcycle or another motor vehicle, other than an omnibus, is among the notified categories when supplied through an operator. The category and the platform’s role in the particular ride both matter; the fact that a booking happened in an app does not alone settle the legal test.
Does the driver or passenger pay instead?
The driver may provide the ride and the passenger may pay the fare, but neither fact alone determines who is legally liable to remit GST under section 9(5). The liability concerns payment to the government; it is distinct from who ultimately bears the tax cost through the fare or contractual arrangement.
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In an advance ruling concerning Uber India, the passenger’s direct payment to the driver did not, by itself, prevent section 9(5) liability from applying to the operator where the ride service was supplied through the platform. That ruling illustrates the rule on the applicant’s facts; it is not a universal decision covering every app or ride model. Read the Uber India ruling.
Why “through the app” matters
Being an e-commerce operator does not automatically make a platform liable for every service provided by a driver who uses it. The notified service must be supplied through the operator under the relevant arrangement and facts.
A West Bengal advance ruling concerning Yatri Sathi found that, although the applicant was an e-commerce operator, the particular driver ride services in its model were not supplied through it for section 9(5) purposes. The ruling underscores that the operator’s actual role in the ride supply matters. Advance rulings apply to their applicants and facts, rather than deciding the treatment of every platform. Read the Yatri Sathi ruling.
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One free scan finds every outdated or missing driver and matches the right update for your exact hardware.Free scan · exact hardware matchWhat GST rate applies to an app-cab ride?
There is no safe basis to assume one rate for every ride or every amount shown in an app. CBIC’s rate table lists these relevant categories:
| Listed service category | Rate and qualification |
|---|---|
| Passenger transport by radio taxi | 5% for the listed category, shown as 2.5% central tax plus 2.5% state tax for an intra-state supply, subject to applicable conditions. |
| Passenger motor-vehicle transport where fuel cost is included in the consideration | 5%, subject to the applicable input-tax-credit restrictions. |
| Metered cabs and auto-rickshaws | The table lists an exemption, but it does not apply to services supplied through an e-commerce operator and notified under section 5(5) of the IGST Act. |
These are categories in CBIC’s GST rates table, not a determination of the rate for every app fare. The vehicle and service classification, whether the supply is intra-state or inter-state, and the current notification wording can affect the treatment. A listed 5% rate is a tax rate; it does not establish how much of a particular fare is attributable to GST.
Can a driver claim the GST threshold exemption?
CBIC says suppliers of services for which an operator pays tax under section 9(5) are entitled to threshold exemption. That treatment relates to notified services supplied through the relevant operator arrangement. It should not be generalized to every driver using any app.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to check the GST on a specific ride
- Open the tax invoice or fare breakdown. Look for the service or vehicle category, GST amount and identity of the supplier or party shown as liable.
- Check the category and rate basis. Compare the description with the applicable CBIC rate-table entry, including its conditions and any input-tax-credit restrictions.
- Ask the platform if the invoice is unclear. Request the applicable GST invoice and the basis for the rate or section 9(5) treatment.
An invoice or app fare can help explain the charge, but the rules and rulings cited here do not determine the contract or invoice treatment for every platform and ride. Seeing GST in the fare does not prove that the passenger is the statutory remitter; paying the driver directly does not, by itself, prove that the driver is.
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