CBEC clarifies threshold exemption doubts on e-commerce

India’s Central Board of Excise and Customs (CBEC) has clarified that the benefit of threshold exemption is not available to e-commerce operators and persons supplying goods or services through an e-commerce operator.

They are liable to be registered under the new Goods and Services Tax (GST) regime irrespective of the value of supply made by them - F2F - Shutterstock

They are liable to be registered under the new Goods and Services Tax (GST) regime irrespective of the value of supply made by them.

In a frequently asked questions (FAQ) document on e-commerce issues released on its website recently, the CBEC reiterated that the no threshold exemption is applicable only if the supply is made through an e-commerce operator that is required to collect tax at source.

However, where the operators are liable to pay tax on behalf of the suppliers under a specific notification under the Central GST Act 2017, the suppliers are entitled for threshold exemption.

Prior to GST implementation, suppliers who used to supply goods and services on the websites owned by others were out of the tax regime in case their turnover was below the threshold limit.

Threshold exemption is also not available to e-commerce operators who are required to pay tax on certain notified services under Section 9(5) of the Act supplied through them. Only in case of such notified services, an e-commerce operator is liable to pay tax in respect of supply of goods or services made through it, instead of the actual supplier. 

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