Summary: GST will give new shape to most of the businesses, in this piece you will come to know how it will impact e-commerce.
GST roll out is just on the verge of turning into a reality from the coming fall. The after effects of the GST has already been visible with few days left before it will finally come up as a law. With many sellers already being compelled to give away the stocks at a lower rate, the discount season has been on at the moment. But it is interesting to find out how the online shopping will work after the GST will come into effect.
Better Tax Collection
The present taxation structure has been rather ambiguous and most of the online shopping market places have been taking advantage of the irregularities in the online ta collection. But with the GST, the tax collected at source will broaden and organize itself. With taxes being imposed on the products, it is most likely that the products will turn costlier in the long run.
Removal of octroi and toll means less paper work involved and it will positively reflect on the delivery of the goods. As no taxes have to be imposed for inter-state transfer, the dealers are not bound by the paper work and they can instantly transfer the goods after the request has been placed on their shopping sites. In the near future, expect your products to reach your doorstep earlier.
Age of Discount Disappearing
Discounts are often given to attract more sales but such will not be the case in the near future. As the sellers will be paying the taxes on the purchase they make with the registered dealers, they will have to pay the taxes. If they sell the product with added discounts, it will never let them recover the cost and they will not be encouraged to sell at below the market price.
Return and Cancellation to get worrisome
For the e-commerce businesses, it will be a tough task to process the return and cancellation, since the tax would be collected the moment they are making any sales. If the consumer in the near future cancels the purchase, the e-commerce companies have already paid the tax on the sales which has been cancelled later. In such a scenario, the e-commerce companies have to file for the refund which might end up being a herculean process.