India: government to bring online marketplace-related transactions under its jurisdiction

Wednesday 22 October 2014 14:11 CET | News

The Indian Karnataka government’s agenda is to amend the VAT Act and subject ecommerce-related marketplace transactions to its jurisdiction, reports.

Moreover, the government states that the amendment will apply to transactions on marketplaces like Flipkart, Amazon India and Snapdeal and it is expected to be passed in the near future.

The amendment is expected to classify online marketplaces as “commission agents” since they charge a commission from third-party sellers for using their platform and their delivery and warehousing services.

As such, online marketplaces are subject to VAT to the state government, because as per the Karnataka Value Added Tax Act 2003, direct sellers and those who sell on behalf of others and charge a commission for it, are both liable to pay tax.

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Keywords: India, government, online marketplace, transactions , jurisdiction, ecommerce, VAT, regulation
Categories: Payments & Commerce
Countries: World
This article is part of category

Payments & Commerce