Government looks to tax goods bought from Chinese e-commerce sites to curb customs evasion

By

Isabelle Crossley

Published
Jul 25, 2019

The government is considering introducing new, higher taxes and customs duties on goods ordered from Chinese e-commerce sites as it continues to crack down on Chinese businesses evading customs by labelling commercial goods as “gifts”.

After cracking down on Chinese “gifts” entering India through Mumbai and other metros, the government is now considering adding tax to the price of Chinese online goods at the buyer’s end which would make customs evasion impossible, ET Bureau reported. The government could introduce a blend of integrated goods and services tax and customs duty that would be levied on the product upon purchase, instead of at the time of shipment as is currently the case. 

“The government is looking to bring in payment gateways on board on the scheme and when the consumer pays the money, IGST and customs duty will be included in the price,” an anonymous source told ET Bureau.

One of the main product categories imported from China as bought by individual customers online is fast fashion. Chinese fashion e-tailers such as Shein, Club Factory, and AliExpress have expanded greatly in India and, despite asserting that they follow regulations, have come under scrutiny by government authorities for allegedly mislabelling shipments to avoid import tax.