: Commercial Taxes Department is going ahead with measures to check tax evasion by online trade agencies. The move is set to result in a slowdown in online purchase of merchandise by customers in Kerala through various popular e-commerce sites.
The department had begun enforcement of rules on taxation for articles purchased online from agencies based in other States. A few courier agencies were penalised for evading tax. The department has constituted a committee to study the issue, according to top officials.
Some of the courier agencies were found to be charging more than the actual value of the articles but were not remitting any tax to the State. Such courier agencies were indirectly acting as agents of the promoting companies which offered articles from toys to laptops online at cheaper rates than that available in Kerala market. The department had found out that the excess amount collected by way of the deal was deposited in separate accounts.
The tax loss was considerable in view of the large number of deals being executed daily in Kerala. Online deals within a State won’t result in tax erosion for the State, a senior commercial taxes official said. Kerala being a consumer State, was at the receiving end, he added.
The commercial taxes department’s action has already slowed down online commercial traffic to Kerala, said Kerala Samsthana Vyapari Vyavasayi Samithi president, Binny Immatty. The Samithi had been demanding steps to monitor online trade which, he alleged, was being misused by various agencies to evade taxes in order to offer articles at cheaper rates. The online sale had been seriously affecting business of retailers in the State, he said.
Of late, several online sites had been blocking deals to Kerala. Such sites have been exhibiting signs of unavailability of merchandise in order to avoid the deals, he said.
