As online and offline retailers are on the warpath, the Odisha government is ready to press the Government of India to impose tax on goods sold through the e-commerce platform at the consumption point to counter onslaught from the e-retailers.
The state government has suggested that the tax needs to be collected by the consuming state where the goods are dispatched.
“We will raise the demand for a tax on goods sold through the online platform at the pre-Budget consultation meeting of state finance ministers with the Union finance ministry on Friday. The tax can be introduced through suitable amendment in the Central Sales Tax (CST) Act,” said a government official.
The official pointed out that with the growing popularity of e-retailers, the turnover of such firms is rising handsomely but it has led to an inequitable situation, denting offline retail trade and precipitating revenue loss for the state government.
“The state government has been losing revenue of Rs 150-200 crore annually for goods purchased through the online channel,” said Arun Kumar Dey, president, Information Technology Association of Odisha (ITAO).
ITAO has been opposing the sale of goods by the online platforms tooth and nail. Recently, it had banned the purchase of IT related products from the national distributors in protest against the online shopping sites which are allegedly selling goods cheaper than the landing cost of the products.
At present, there are no regulations for collecting tax on online buying of goods. The government must levy at least 10 per cent entry tax as proposed by the Bihar government for increasing its revenue basket, he added.
ITAO has already requested the state government to look into the alleged unethical practices adopted by the online traders. It has been demanding regulations for providing level playing field for both the online and brick and motor players.
Nationwide, the offline retailers have been crying foul over their online counterparts, blaming them for adopting predatory practices and pulling customers through tempting discounts. E-commerce firms are also facing charges of delivering counterfeit and defective products.
Leading players in e-commerce space like Amazon, Flipkart and Snapdeal are luring prospective buyers through hefty discounts and other freebies, leaving offline vendors in a quandary.
Though the annual sales turnover of the offline retail sector is estimated to be $25 billion (Rs 150,000 crore), significantly higher than $3 billion of the emerging e-tail sector, many retail formats are already feeling the heat.
More and more people are joining the online shopping bandwagon hoping to get better deals, resulting in slowing sales of electronic goods, apparel, consumer durables and other utilities from the offline retail stores.
The Confederation of All India Traders had urged the Union commerce ministry to regulate e-retail business and trade practices of its companies, as they were offering tempting discounts.
The state government has suggested that the tax needs to be collected by the consuming state where the goods are dispatched.
“We will raise the demand for a tax on goods sold through the online platform at the pre-Budget consultation meeting of state finance ministers with the Union finance ministry on Friday. The tax can be introduced through suitable amendment in the Central Sales Tax (CST) Act,” said a government official.
The official pointed out that with the growing popularity of e-retailers, the turnover of such firms is rising handsomely but it has led to an inequitable situation, denting offline retail trade and precipitating revenue loss for the state government.
“The state government has been losing revenue of Rs 150-200 crore annually for goods purchased through the online channel,” said Arun Kumar Dey, president, Information Technology Association of Odisha (ITAO).
ITAO has been opposing the sale of goods by the online platforms tooth and nail. Recently, it had banned the purchase of IT related products from the national distributors in protest against the online shopping sites which are allegedly selling goods cheaper than the landing cost of the products.
At present, there are no regulations for collecting tax on online buying of goods. The government must levy at least 10 per cent entry tax as proposed by the Bihar government for increasing its revenue basket, he added.
ITAO has already requested the state government to look into the alleged unethical practices adopted by the online traders. It has been demanding regulations for providing level playing field for both the online and brick and motor players.
Nationwide, the offline retailers have been crying foul over their online counterparts, blaming them for adopting predatory practices and pulling customers through tempting discounts. E-commerce firms are also facing charges of delivering counterfeit and defective products.
Leading players in e-commerce space like Amazon, Flipkart and Snapdeal are luring prospective buyers through hefty discounts and other freebies, leaving offline vendors in a quandary.
Though the annual sales turnover of the offline retail sector is estimated to be $25 billion (Rs 150,000 crore), significantly higher than $3 billion of the emerging e-tail sector, many retail formats are already feeling the heat.
More and more people are joining the online shopping bandwagon hoping to get better deals, resulting in slowing sales of electronic goods, apparel, consumer durables and other utilities from the offline retail stores.
The Confederation of All India Traders had urged the Union commerce ministry to regulate e-retail business and trade practices of its companies, as they were offering tempting discounts.
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