Indian states are looking at ways to tax e-commerce transactions
to get a piece of growing e-commerce revenue, even as tax laws try to keep pace
with evolving business models and corporate structures, especially in the
context of most large e-commerce companies boasting marketplace models that
connect buyers to sellers.
At a meeting of the empowered committee of state finance ministers
held in New Delhi last week, it was decided that a committee of state and Union
government officials would look into the issue. The decision on forming the
committee came after states expressed concerns about losing out on tax revenue
because of gaps in existing tax laws.
“The committee will look at how such transactions can be taxed
under the existing laws. Other options like amending the Central Sales Tax Act
will also be explored,” said an official from one of the states who asked not
to be identified. An official from another state said the committee would
recommend ways to tax e-commerce.
