Indian government announces 25% TDS cut to ecommerce

Friday 15 May 2020 14:50 CET | News

The Indian government has announced a TDS rate reduction by 25% for ecommerce, as part of the Atma-nirbhar Bharat Abhiyan economic stimulus package.

According to Economic Times Tech, the 25% reduction in tax deducted at source (TDS) on ecommerce participants will benefit merchants or sellers, providing them with more working capital.

However, sellers and ecommerce marketplaces still declare that the TDS levy should be removed altogether as it will lock up liquidity and add to compliance costs, adding that the government should also clarify whether the deduction will be on gross or net sales.

Moreover, industry insiders stated that the relaxations would not lead to any substantial immediate benefit for online sellers. For example, Snapdeal and the All India Online Vendors Association (AIOVA) welcomed the TDS rate reduction on commissions from 5% to 3.75%, but still sought for more aid from the government to help drive a robust recovery of the sector.

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Keywords: indian government, India, TDS cut, ecommerce, Snapdeal, All India Online Vendors Association, AIOVA
Categories: Payments & Commerce
Countries: India
This article is part of category

Payments & Commerce