Tax Collection At Source Implication On E-Commerce Operators And Online Sellers

Ambica Sood
watch_later 4 years ago

  1. Do E-commerce operators need to deduct tax from amount payable to online sellers?
  2. Do all E-commerce operators have to collect tax at source or is there any threshold limit?
  3. What are the different provisions governing this requirement?
  4. How online sellers will be affected or impacted by this?
  • chatComments
1 Answer

GST Payer watch_later 3 years, 11 months ago

Yes this is a hot discussion topic among E-retailers. TCS or tax collection at source will make transactions more complicated.

For example, Flipkart will deduct tax and pay to their online sellers. In case of goods returned by buyers, again accounting and reversal of TCS will be complicated.

We have to wait and watch before commenting further on this, but as of now things look little complicated.

Impact on sellers will be dual, first already they have to be careful about their working capital management and secondly TCS will further have impact on capital management.

Now returns needs to be accurately accounted to get back the TCS portion otherwise it will negatively impact their operating margins.

  • chatComments
    Compared to current position, have you done any analysis as to quantum of hit on working capital management. - Pulkit Sharma
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