GST IMPACT ON ECOMMERCE SELLERS


GST is a revolutionary tax reform in India since last 200 years & almost the whole country is talking about it. Having said that no one really understands how it actually works & everyone is having their opinion on it. When general people welcome it in open arm, for sellers it is their worst nightmare. We are one of them. Though it is a very good thing for a customer & most of the business, but it actually hit hard towards the eCommerce business Especially for the third party sellers. In the country like India, where third party sellers are really controlling the marketplace it is very difficult for them to adjust to it. With many items' price suddenly hiked because of the new tax slab small sellers are really struggling to cope with it. Either they are changing their product or they have no options but to opt out of the business. Some examples are Tablecloth, handkerchief, socks, college bags, school bags etc. GST made two things very complicated for the eCommerce sellers with & there is no such obvious reason behind it.



So in short, the price of the items drastically changed. It is again a very complex thing to explain to everybody but if you can't claim the input tax credit it is very difficult for you to survive. Again, you might ask what is input tax credit? well, the simplest answer I can give here is the tax you are paying will be given back to you by the Govt. after deducting their appropriate amount. What ? What ? 

Well, this is the same reaction it comes from my mouth. So in theory, you can claim input tax credit if you have paid any tax to the manufacturer, but many small manufacturer/seller don't register in GST because Govt has exempted from registering in GST & their turnover is less than 20 lakhs slab. So we pay cash to the manufacturer or seller & bought the item. We did not pay any tax because there is no structure. So I am the first person in the chain, so I have to pay the tax to the Govt. Why ? Why ?

Honestly, We don't have any answer to it. One the stupidest decision anyone can take is to implement this taxation. Anyway, life has to move on & you have to find out a way to handle every situation but this implementation literally cost me the whole business.  

We will See how it pans out. still, if you have any query please post it in comment section.

Find my Video with example - https://youtu.be/yzBoxaJYxRY

Location: New Delhi, Delhi, India

Comments

  1. Set My BizJuly 25, 2017 at 2:29 PM


    Thanks for this information and for this post.
    gst registration

    ReplyDelete
  2. harishOctober 10, 2020 at 1:55 PM

    Under most of the indirect taxes historically, E-Commerce has been a confusion. Thanks to GST, however, it puts an end to much of the mystery and offers more clarification. Know more: GST Registration

    ReplyDelete

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