BUSINESS

‘Deep discounts by e-com firms hitting GST revenue’

The Confederation of All India Traders (CAIT) has written to Finance Minister Nirmala Sitharaman alleging loss of GST revenue to the government due to deep discounting by e-commerce firms, particularly Amazon and Flipkart.

Seeking investigation into the business model of both the players, CAIT said e-commerce companies sell goods much below their market value, thereby denying the government the legitimate GST revenue.

“E-commerce portals, particularly Amazon and Flipkart, where deep discounts ranging from 10-80% are being given... is quite abnormal and generally not available in offline market ...[online] sales are made on a much lower price than the market value of the product and as such the GST is charged by them on the sale price,” CAIT secretary general Praveen Khandelwal said in the letter.

Actual value

Stating that under the GST Act, the government has the power to determine actual market value of the products if it appears to be under billed, CAIT said it had sent similar letters to Commerce Minister Piyush Goyal as well as the Finance Ministers of all the States.

“By lowering the price artificially in order to capture market, these e-commerce companies are causing huge loss of GST revenue to the government and violating the FDI policy of the government,” it alleged.

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