Online retail to come under GST
New Delhi, July 19 (PTI): The government’s “Place of Supply” rules for the goods and services tax regime – being drafted by the revenue department – will comprehensively cover e-commerce services.
These rules will be important as the goods and services tax (GST) will be destination based and levied at the point of delivery. They will help to determine the location of supply of goods or services as also whether the supply is intra-state or inter-state.
The rules will take into account sales through e-commerce, V. S. Krishnan, member of the Central Board of Excise and Customs, said.
“They are essential and extremely important because there are pan-India services such as banking, telecom, insurance where it is not so easy to locate the recipient of service. E-commerce will also have to be taken care of through these rules,” he added.
According to estimates, the e-commerce market in the country is around $5 billion and online shopping is expected to expand at a massive rate.
For the rollout of GST, the CBEC is already preparing model legislations, which will be put up for comments from stakeholders after Parliament approves GST Constitution Amendment Bill.
The three legislations – Central GST (CGST), State GST (SGST) and integrated GST (iGST) – will have to be approved by the respective legislatures.
The government plans to implement a single GST rate, which would subsume central excise, service tax and other local levies, from April 1, 2016.
A parliamentary committee, which scrutinised the crucial GST bill, has prepared a draft report wherein the government has agreed to provide compensation to states for any revenue loss for five years, thus giving in to one of the major demands from several Opposition parties.
The report will be considered by the select committee of the Rajya Sabha tomorrow when it is expected to be adopted for presentation in Parliament which convenes on Tuesday.
According to sources, the government will move an official amendment to the GST bill. The amendment relates to Clause 19 of the bill, amended version of which now reads as, “Parliament may, by law, on recommendation of the GST council, provide for compensation to the states for loss of revenue arising on account of implementation of GST for a period of five years,” a source said.
The earlier version said the compensation would be paid for “up to five years”. The Opposition parties also wanted the word “may” to be changed to “shall” in the clause.
However, the government argued that both words, according to the Constitution, meant the same thing.
The panel completed the consultation process last Friday when clause-by-clause discussion took place on the bill.
Source:- http://www.telegraphindia . com/1150720/jsp/business/story_32506.jsp#.Vayd5vmqqko