Flipkart’s Big Billion Days or E-commerce festival sales may boost GST tax revenue

Highlights 

Festive time: Like every year, online e-commerce site liking increase in sales volume

TCS provisions applicable from 01 Oct, 2018 this year

Rate of TCS is notified as 1% of net taxable supplies for intra-state supplies. (i.e 0.5% of CGST and 0.5% of SGST )

Rate of TCS is notified as 1% of net taxable supplies for inter-state supplies. (1% of IGST)

More deduction for online seller

Present Avg GST collection 85-100K crore per month.

Flipkart big billion days sale, Amazon Great Indian Festival offers and sales on all other e-commerce portal like paytm, snapdeal etc is not only bringing offers for consumers. But here the Tax department looking for huge tax collection in GST

Flipkart-Big-Billion-Days-sale

Last month by notification government notified 1st october 2018 is the date when the provisions of TCS will applicable on e-commerce portal. 

What is TCS (Tax Collected At Source) under GST?

Tax Collected at Source (TCS) under GST means the tax collected by an e-commerce operator from the consideration received by it on behalf of the supplier of goods, or services who makes supplies through operator’s online platform. TCS will be charged as a percentage on the net taxable supplies.

According to section 52 of CGST Act, 2017 every e-commerce operator require to deduct tax @1%  of the net value of taxable supplies made through it by other suppliers. 

Rate of TCS is notified as 1% of net taxable supplies for intra-state supplies. (i.e 0.5% of CGST and 0.5% of SGST )

Rate of TCS is notified as 1% of net taxable supplies for inter-state supplies. (1% of IGST)

Who is liable to Deduct TCS?

Every E-commerce operator 

How will this boost TAX revenue?

Every year e-commerce companies do business in thousand of crores during festival season but there is no GST tax collection for government directly from these companies. Only the seller were responsible to submit their tax.

But from this year- E-commerce companies has to deduct 1% of the total sales value and deposit it to government. 

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