Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: TDS :: ACCOUNTING STANDARD :: VAT RATES :: cpt :: VAT Audit :: form 3cd :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: articles on VAT and GST in India :: due date for vat payment :: empanelment :: ACCOUNTING STANDARDS :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes
 
 
ę VAT (Value Added Tax) »
 Haryana govt exempts solar equipment from VAT
 AP to push for same benefits under GST for VAT exempted goods
 Andhra Pradesh to push for same benefits under GST for VAT exempted goods
 Petrol prices set to rise in Goa with increase in VAT
 Payment systems to remain open on all days from March 25, 2017 to April 1, 2017
 Delhi cuts VAT on ATF to 1% for regional flights; other states to announce the same soon a
 Shops cannot charge VAT on discounted items: Consumer forum
 Delhiites have to pay lowest taxes as AAP govt announces cuts on VAT on various items
 Tamil Nadu minister justifies VAT hike on fuel
 State Government urged to withdraw hike in VAT on petrol, diese
 High VAT may encourage illegal trading

VAT problem: Amazons operations face disruption
September, 17th 2014

With the Karnataka commercial tax authorities contending that Amazon India is liable to pay VAT (value added tax), because it is a trader, the e-commerce player finds itself on a somewhat sticky wicket. Moreover, the notices issued to the 40-50 vendors, by the department for registering Amazon’s fulfilment centre as an “additional place of business” without properly disclosing that the premises was being shared by several businesses, could disrupt operations at the e-commerce major.

Tax experts, however, point out that Amazon is a pure service provider and, therefore, not liable to pay VAT. Sujit Ghosh, Arguing Counsel, Taxation, Advaita Legal, observed that the contention was frivolous and not based on an understanding of fulfilment services. “It goes against the order issued in favour of Amazon by the Authority of Advance Rulings in August 2012, holding that the activity was a service.” The ruling had

held that “...what the

applicant is providing is an online retail distribution channel and the associated logistical services... His role therefore does come across clearly as one of service provider”.

Anita Rastogi, associate director (indirect taxes), PWC, observed that the rules on e-commerce companies were unclear.

“The law does not specify than an additional place of business can apply to one vendor or several vendors,” Rastogi said, adding that the department was probably not ready to acknowledge that this was an additional place of business.

Amazon India follows a ‘Fulfilment by Amazon Service’ model wherein the global giant encourages third-party sellers, on its platform, to store goods in its warehouses even before an order is placed. The idea is to be able to deliver quickly when customers make purchases.

Krupa Venkatesh, senior director, Deloitte, said the e-tailer was taking possession of the goods for delivery similar to a courier agent, instead of owning the goods.

“If goods are stored in someone’s warehouses, they have possession of goods but they don’t own the goods. In case of an e-commerce marketplace, the dealer who is selling the goods, being listed on the marketplace, is renting warehouses. It can be a service of renting,” Venkatesh said. “Some e-commerce firms sell on their own account, some do not. It may not be right to say all e-commerce companies are commission agents,” she added.

A senior tax official, who declined to be named, told FE, “There are no issues against marketplace model. But in the fulfilment model goods come into the warehouse before

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Work Flow Workflow Software Software Automation Workflow automation Software Design Workflow Design Business Work Flow Workflow automation tools

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions