Sellers not worried about capital blocking
Capital blocking due to TCS is a major concern for e-com platforms; one that is apparently not shared by sellers. A spokesperson for AIOVA stated that they do not see the TCS affecting liquidity as online platforms already hold seller money. The e-Commerce Sellers Association of India also echoed the same sentiment, reiterating the fact that a tax collected at source will force merchants without proper registration to move out of the system and create a level playing field for everyone.
A pro-TCS attitude does not mean sellers have no concerns about it at all. For instance, the online apparel market sees 15-20% returns on an average. Sellers in this category are worried that the process to reclaim TDS for such transactions might be cumbersome. The AIOVA has also decided to make a recommendation to the GST council to keep TCS at a threshold limit, especially if the current VAT liability for a seller is less than the proposed TCS amount.
How TCS will affect e-com sellers?
Here’s an in-depth post we did about understanding the impact of GST and the TCS clause on the e-com sector. While we wait for details on TCS limits to emerge, it would be good if you as an online seller took the first steps to becoming GST-ready. This way, when the change comes, you will not be caught off guard! So, what can you do to be prepared for GST? Glad you asked:
- Get your enrollment done on time. To read more about the enrollment process and its relevance, Click here.
- Plan your logistics and warehousing requirement carefully. To read our detailed guide on impact analysis on logistics and warehousing, Click here.
- Adopt such platforms, technologies which will enable your business to be GST-compliant. Click here to get all updates and access a pool of GST Calculators.
Want an expert to explain GST to you? Get one, right here!