Need Tally
for Clients?

Contact Us! Here

  Tally Auditor

License (Renewal)
  Tally Gold

License Renewal

  Tally Silver

License Renewal
  Tally Silver

New Licence
  Tally Gold

New Licence
 
Open DEMAT Account with in 24 Hrs and start investing now!
Direct Tax »
Open DEMAT Account in 24 hrs
 Know All Income Tax Due Dates for 2023: CBDT Releases E-Calender
 Missed filing ITR? Deadline to file belated income tax return to end on December 31
 Income Tax Return: Regular filers getting intimation with pending status for not filing ITR yet
 Partial relaxation with respect to electronic submission of Form 10F by select category of taxpayers in accordance with the DGIT (Systems) Notification No. 3 Of 2022
 Income Tax Return: Why is ITR verification time limit reduced? Is the reduction going to stay?
  Will CBDT proposal simplify taxpayers' job? Common Income tax return form
 What is Rule 132 of Income Tax and how it is important for taxpayers?
 How to file ITRs when it s belated, revised, updated
 What is the difference between belated, revised and updated ITRs?
 CBDT notifies Rules for E-Filing of Income Tax Return by Successor Entity to a Business Reorganization in Form ITR-A
 Direct tax collections may exceed budget targets, CBDT chief says

Government should make tax compliance easy for e-commerce operators
September, 19th 2014

The Karnataka government has erred in asking online retailer Amazon to pay value added tax (VAT) on products it does not own or sell.

The company is just a service provider, a service it calls 'fulfilment' on its marketplace platform for which it charges the merchant. The merchant, in turn, pays VAT collected from the customer to the state government.

Amazon, if at all, is liable only to pay service tax, and for this, the Centre should deem 'Fulfilment by Amazon' as a taxable service. The current tax row though is independent of the enforcement directorate's probe to find out if Amazon has violated India's foreign direct investment laws.

Online retail is expanding fast in India. The case to bring it into the tax net is compelling. It will help prevent tax-base erosion profit shifting. Not unexpectedly, the OECD, a club of rich countries, sees the digital economy as a revenue gold mine, and urges countries to impose VAT.

In the US, for example, online retailers already pay sales tax in many states that have adopted state online laws, also called Amazon tax laws. There is no reason why India should be an outlier.

True, state tax laws in India predated online retail and, therefore, e-commerce transactions do not find specific mention in these laws. That must change. It makes eminent sense to tax e-commerce deals because India wants to adopt a goods and services tax (GST). Without a tax on e-commerce sales, the GST chain would be broken.

A tax on their sales is the only way e-retailers can get credit for the taxes they pay on their inputs. Else, doing business in India will not be lucrative. The main job is for the government to create procedures that make tax compliance easy for e-commerce operators, and tax all value additions along the chain.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2023 CAinINDIA All Right Reserved.
Designed and Developed by Ritz Consulting