Impact of GST

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Impact of GST on Ecommerce Market Place Here Is
What You Need To Know
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• Goods and Services Tax (GST) is a single tax
  reform that is applicable across all states in
  India. This GST taxation will replace all the
  existing indirect taxes such as sales tax,
  service tax, VAT, CST, entertainment tax, luxury
  tax etc.
• The vision behind this taxing is to bring the
  nation together under a single tax structure,
  right from manufacturers to end consumers
  creating a unified common market.

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• India has started to roll out with the new era
  taxation of GST from 1st July, 2017. Ecommerce
  industries will have noticeable impact with GST.
• This taxation structure is expected to
  rationalize seamless integration of goods and
  services across India. Let us explore the
  positive and negative impacts on ecommerce
  marketplace at various stages.

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Major Changes on Ecommerce

• Registration - Under GST all ecommerce business
  operators are mandatorily required to register
  irrespective of their turn over.
• Listings Harmonized System Nomenclature
  code (HSN) is a globally accepted nomenclature
  for classifying traded products. Tax rate that is
  applicable for a particular HSN code will be used
  for computing all taxes. All sellers will have to
  enter this HSN code of all the products on their
  dashboard as a compliance requirement.

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Filing of GSTR-8 Ecommerce business operators
have to file a special tax GSTR-8 which will be
containing tax details that is collected from
their suppliers sales. In addition they also
have to file their monthly return taxes GSTR-1
and GSTR-2 and GSTR-9, an annual return.
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Positive Effects

• Tax-Credit - With GST implementation online
  business sellers can claim their currently paid
  service tax on commission. This service tax
  amount can be used as an input credit that will
  increases their profit margin.
• Eliminating Tax Cascading With GST
  implementation, all taxes are integrated into
  uniform tax. This will bring down overall cost.
  With this uniform tax dispute between goods and
  services will end up.

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• Reduction in logistic costs At present for
  logistics, ecommerce sellers are paying border
  taxes that are levied for movement of goods from
  one state to another.
• With GST the costs for logistics movement will
  come down. Also the separate paper work for each
  state wont be needed. Hence delivery of products
  will be made faster.

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• Ease of process Under GST generating invoice
  will become easier as the invoices will only
  include HSN number for distinguishing between
  sales of different goods.
• The invoices uploaded by the sellers will be
  visible to buyers. Hence online sellers will get
  their tax burden reduce and transparency is
  increased.

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Challenges

• TCS deduction - It is expected online marketers
  will be impacted by TCS (Tax Collection at
  Source) by market places. It has made mandatory
  that ecommerce business owners have to pay tax on
  the price of goods purchased from suppliers.
• Decline of Discounts As discounts will
  attract extra taxes under GST, discounts offering
  often may reduce.

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Complex in returns and cancellations Online
sellers will have cancellation fees of 18. They
will have to bear this tax amount and collect at
the source and have to wait for refund from
government in the cases of cancellations. Hence
ecommerce business will face a huge disadvantage
with these refund and cancellation issues.
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From both the perspectives of taxation and
operations, ecommerce business will gain major
positive impacts. On the other hand, any new
changes introduced will have their own set of
challenges. However GST will bring more
transparency and ease of process which will be a
boon to the ecommerce industry.
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GST taxation will redefine the current market and
create a uniformity and simplification in the
system. To sum it up, GST renders a perfect
blend of easy procurement for buyers and
simplified selling for sellers. -- By,
Ecommerce Website Development In Chennai
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Website www.jayamwebsolutions.com Phone 044 -
2276 1701 Mobile 91 - 96 77 87 6445 E-mail
marketing_at_jayamwebsolutions.com
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