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E-commerce companies to pay up to 1% TCS under GST

E-commerce companies will also have to file returns on the TCS deductions

Press Trust of India  |  New Delhi 

e-commerce, ecommerce, online
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firms like and will have to mandatorily deduct up to 1 per cent (Tax Collected at Source) while making payments to their suppliers under the regime which is expected to kick in from July 1.

The model Goods and Services Tax (GST) law, finalised by the Council, provides for 1 per cent to be deducted by the operators.



The model law provides that every electronic commerce operator, not being an agent, shall collect up to one per cent TCS, as may be notified on the recommendations of the Council, of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.

Experts had raised concerns saying this would mean that a similar amount will have to be levied on inter-state movement of goods, taking the total deduction to 2 per cent.

"We have included the word 'up to' in the final model law. This would mean that would not exceed 1 per cent of the sale proceeds," an official said.

has been expressing concern over the provisions saying it would mean a lock-in of capital and also dissuades from selling through online aggregators.

will also have to file returns on the deductions, but in case of return of goods by the consumer, these will not have to deduct as there is no actual sale.

The model law had defined 'electronic commerce' as supply of goods or services, including digital products, over electronic network.

'Electronic commerce operator' would mean those persons who own, operate or manage digital or electronic facility or platform for electronic commerce.

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E-commerce companies to pay up to 1% TCS under GST

E-commerce companies will also have to file returns on the TCS deductions

E-commerce companies will also have to file returns on the TCS deductions firms like and will have to mandatorily deduct up to 1 per cent (Tax Collected at Source) while making payments to their suppliers under the regime which is expected to kick in from July 1.

The model Goods and Services Tax (GST) law, finalised by the Council, provides for 1 per cent to be deducted by the operators.

The model law provides that every electronic commerce operator, not being an agent, shall collect up to one per cent TCS, as may be notified on the recommendations of the Council, of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.

Experts had raised concerns saying this would mean that a similar amount will have to be levied on inter-state movement of goods, taking the total deduction to 2 per cent.

"We have included the word 'up to' in the final model law. This would mean that would not exceed 1 per cent of the sale proceeds," an official said.

has been expressing concern over the provisions saying it would mean a lock-in of capital and also dissuades from selling through online aggregators.

will also have to file returns on the deductions, but in case of return of goods by the consumer, these will not have to deduct as there is no actual sale.

The model law had defined 'electronic commerce' as supply of goods or services, including digital products, over electronic network.

'Electronic commerce operator' would mean those persons who own, operate or manage digital or electronic facility or platform for electronic commerce.
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Business Standard
177 22

E-commerce companies to pay up to 1% TCS under GST

E-commerce companies will also have to file returns on the TCS deductions

firms like and will have to mandatorily deduct up to 1 per cent (Tax Collected at Source) while making payments to their suppliers under the regime which is expected to kick in from July 1.

The model Goods and Services Tax (GST) law, finalised by the Council, provides for 1 per cent to be deducted by the operators.

The model law provides that every electronic commerce operator, not being an agent, shall collect up to one per cent TCS, as may be notified on the recommendations of the Council, of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.

Experts had raised concerns saying this would mean that a similar amount will have to be levied on inter-state movement of goods, taking the total deduction to 2 per cent.

"We have included the word 'up to' in the final model law. This would mean that would not exceed 1 per cent of the sale proceeds," an official said.

has been expressing concern over the provisions saying it would mean a lock-in of capital and also dissuades from selling through online aggregators.

will also have to file returns on the deductions, but in case of return of goods by the consumer, these will not have to deduct as there is no actual sale.

The model law had defined 'electronic commerce' as supply of goods or services, including digital products, over electronic network.

'Electronic commerce operator' would mean those persons who own, operate or manage digital or electronic facility or platform for electronic commerce.

image
Business Standard
177 22