From the past few days we are hearing the plans of Telangana government planning to tax e-commerce giants operating in their state and now Andhra Pradesh government is also heading in the same direction. It is said that the enforcement teams of the commercial tax departments are carrying out inspections and raids at courier service points and other facilities used by e-commerce firms from the last few days and are taking note of the consignments they deliver.
Many e-commerce sites do not sell products but operate as middle men between sellers and buyers, AP government is planning to bring in a new law where in dealers, aggregators, retailers, facilitators or commission agents whatever they call have to shell out VAT to the state.
Online business do not pay up taxes to the respective states despite making sales here. Also due to the cheap rates they sell, purchasers do not opt for sales in shops and shopping malls which duly pay their taxes to the government. In either way, the state is losing due to online sales. Recently Karnataka cracked whip on Amazon on a similar allegation.
