It has been more than 1 year since the revolutionary rollout of the Goods and Services Tax(GST) Bill shook the country.
E-commerce has impacted the aspect of customer outreach, like never before. The main advantage of electronically managed distribution channels sover brick-and-mortar outlets is that the business owners have a chance to create a global audience and an International brand. This is exactly what the e-commerce industry has been trying to capitalize and they have been extremely successful in it more or less. From toothpaste to television, now you get anything at your doorstep with a few clicks.
Even The Numbers Don’t Lie —
Asper a study, online shopping is expected to make an annualised growth of 115 percent this year. The report also adds that number of online shoppers are to surpass 120 million in 2018. Some of the most important factors for the positive growth can be contributed to the fast-increasing data consumption and improvement in logistics, along with a number of offers presented by e-commerce platforms.
Impact of GST on E-Commerce Businesses —
The Union Government introduced the GST(Goods and Service Tax) reform in July last year to unify the country under a single tax regime. The new reform was formulated to overcome the complicated and uneven tax system. Let’s delve in deeper to see how implementation of GST impacted the e-commerce marketplaces-
- Significant Growth in Opportunities:
The introduction of GST eliminated all of the confusing interstate taxes the state government imposed on all kinds of retailers and has replaced those with a single tax. Because of this uniform playing field it would be incredibly easy for e-commerce business owners to cater to customers in their own state and in other states. As a result, you have the opportunity to sell products to customers across India or around the world.
- Significant Reduction in Frauds:
The advent of this new reform also helps keep the fraudulent activities at bay. Under the new GST scheme, e-commerce business would need to register mandatorily. all suppliers on e- commerce platforms are mandatorily required to register under GST, irrespective of turnover. In other words, even if an e-commerce supplier’s aggregate turnover is less than INR 10 Lakhs (in Special Category States) or INR 20 Lakhs (in rest of India), registration will be mandatory.
- Ease in Filing Returns:
The The e-commerce sellers need to follow the same return filing process that is followed by traditional retailers. The e-commerce business report all supplies made by the seller. The sales reported by the e-commerce operator will have to match with the sales declared by the supplier himself at the end of every month.
GST Suvidha Providers help these e-commerce platforms in meeting compliance. Thanks to which, now every business in the country would be tax compliant which would ultimately be beneficial to them in seeking extra tax credit.
Additionally, online accounting softwares, also offer direct GST filing solution which removes the hassle of going through the filing process by the help of above mentioned GST Suvidha Providers(GSP).
Given that e-commerce sector in India is one of the most rapidly advancing sectors, not only in India, but Internationally, the Government is vigorously promoting digitised economy and ways these e-commerce business can stay tax compliant. And thus, in the long run, e-commerce businesses can thrive under the GST regime.