Ease of biz relief in store for small ecomm sellers

New Delhi: The Goods and Services Tax Council at its meeting Wednesday would consider a proposal to allow small sellers on ecommerce platforms to sell nationwide with a single registered address. If approved, this would benefit hundreds of thousands of sellers who, under existing GST rules, must have a registered place of business in every state they sell.

The council would also seek to place every online platform on the same footing in terms of who pays the tax on a service, addressing ambiguity on the issue, said people familiar with the proposals to be considered at the meeting.

Small sellers would be able to use an ecommerce platform's warehouses as their place of business in states where they do not have their own premises, the people said. They would need a physical presence in only one state where the physical verification of the address and Aadhaar authentication will take place.


Registration outside the home state can follow with the consent of the ecommerce platform whose warehouse they use, without requiring any intervention from the tax authorities, the people said.

This proposed change in the rule would enable even a small seller to sell nationwide with a single verified address. Ecommerce platforms, however, would be required to nominate a person responsible for providing information about the sellers, share verified seller data and report any changes such as the removal of a seller or alterations in his particulars.

Also read: Next-gen GST: Taking India's reform journey forward

As per data available, around 1.05 million sellers supply goods through ecommerce platforms.

Tax on Services Booked Online

The council will also take up a proposal in connection with the long-standing dispute over who should pay GST on services booked through ecommerce platforms.

The law places the liability on platforms for certain services.

However, different platforms, particularly operating cab-booking services under divergent commercial arrangements, had interpreted the provision differently.

The proposed definition seeks to place liability on the service itself rather than how a platform arranges its contracts.

Additionally, delivery of goods ordered on a platform will attract a 5% levy without credit in every case to ensure that the tax on a delivery is the same irrespective of the route.

Ecommerce platforms would be required to file their monthly collection statement even when no tax is collected, as per the changes proposed.