Lok Sabha Question No. 3236 (UNSTARRED), answered on 2015-12-18
Subject: e-Commerce Revenue
Ministry: FINANCE
Asked by: MAJ. GEN. (RETD) BHUWAN CHANDRA KHANDURI AVSM, HUKUM SINGH

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO. 3236

TO BE ANSWERED ON FRIDAY, THE 18TH DECEMBER, 2015 27 AGRAHAYANA,1937 (SAKA)

## e-Commerce Revenue

3236

SHRI MAJ: GEN: B.C. KHANDURI AVSM (RETD:)

SHRI HUKUM SINGH

Will the Minister of FINANCE be pleased to state:

- (a) whether e-commerce business has been growing in the country at a very fast pace and if so, the details thereof;
- (b) whether the Government has been earning any revenue through ecommerce;
- (c) if the details thereof the last three years and the current year; and SO, during
- (d) whether the proposed GST  regime offers hope to address e-commerce concerns of consuming States by bringing both goods and services under the same tax rates if the details thereof and if not, the reasons therefor? SO,

## ANSWER

(SHRI JAYANT SINHA)

- (a) to (c): e-commerce business like any economic activity is governed by the existing lawslregulations governing economic activity. So far as collection of taxes are concerned, the following is the legal position:
- (ii) Goods procured online, if manufactured, are cleared from on payment of applicable Central Excise duty: factory
- Goods procured online for import into India attract Customs duty at the stage of their importation.
- (iii) As regards good sold online in the case of domestic trade, the following is applicable:
- (a) If the e-tailing company sell goods on its own account; such sale is liable to VAT, which is a State subject   Trading of goods online does not attract levy of Service Tax, as are included under 'negative list' of services under Section 66D of the Finance Act; 1994. they

- (b) If the e-tailing company provides support;, such as, affiliation, support to the retailer by way of business and goods are Besides, any service collected by the e-tailing company attracts services tax retailer byaWay of online\_advertisement also attracts servicetac is, in any case, liable to pay VAT, which is a States The subject.

Further; e-Commerce web-sites with intermediaries or aggregators. Under Rule services are 'aggregator' means a 2(aa) of the Service Tax Rules, application, and person; who owns and manages a web based   software by means of the application and a communication potential customer to connect with device, enables a under the brand name or trade persons providing service of a particular kind name of the aggregator: However; provide services on their own account also In that aggregators liable to service tax as per the case, the services provided are 2015, with effect from provisions of the Finance In Union Budget Service Tax 01.03.2015, the aggregator has been made liable to on behalf of the service providers if the service is pay brand name of the aggregator in so provided the concerned any manner. In so far as the intermediaries are liable to Service Tax for the commission are service provider will pay the Service Tax for the receivved and the of service by business the services provided. In case of import recipients of such service is liable to pay Service dealing mostly may Act, using they entity , Tax:

Since the Excise Duty, Service Tax and VATI CST Government (CBEC) and concerned State are collected by Central through e-commerce is maintained Governments, no data of revenue centrally. earning

- (d) aseper the Constitution (122nd Amendment) , Bill passed by the Lok Sabha in April and is 2014 which has been goods and services have been pending consideration in Rajya Sabha; both Tax in GST regime. peoposed to be brought under the Goods and Service However the rate %f GST would be recommended council as per provisions of the clause by the GST Amendment) , Bill 2014 12(4)(e) of the Constitution (122nd Yes,