All e-commerce operators who are not agents need to collect TCS of up to 1 per cent of the total value of taxable net supplies made by the other suppliers through it and the consideration with respect to these supplies will have to be collected by the operators.

The industry is concerned over the provision of TCS in the model law as it could lead to a lock-in of capital. It could also deter companies from selling their products through online marketplaces, according to media reports.

E-retailers are expected to file returns on TCS deductions, but if the sold goods are returned by buyers, the TCS for the products will not be deducted.

E-commerce players in India had urged the government to re-evaluate the TCS clause. As an estimate, this clause would lead to locking up about Rs 400 crore of capital per annum for the e-commerce sector. In addition, it would result in a loss of an estimated 1.8 lakh jobs, putting a halt to the growth and investments in the sector, e-commerce sector stakeholders had said at a press meet organised by the Federation of Indian Chambers of Commerce and Industry (FICCI). (KD)

Fibre2Fashion News Desk – India