The GST is facing new conflict with the taxing of emerging e-commerce business.Some states have sought the right to tax business to business transactions, which shall affect the very purpose of GST.
Some states want place of supply rules to allow them to tax business to business transactions, even though the final consumption is taking place in another state.This would affect the input tax credit method.
Place of supply rules determine where goods or services are supplied and consumed especially for e-commerce business, thereby determining the place of taxation.Since GST is consumption based tax, it should be levied at the place of consumption.
A sub-group having officials of central and state of the empowered committee have been given the task of framing the rules.
Some states want place of supply rules to allow them to tax business to business transactions, even though the final consumption is taking place in another state.This would affect the input tax credit method.
Place of supply rules determine where goods or services are supplied and consumed especially for e-commerce business, thereby determining the place of taxation.Since GST is consumption based tax, it should be levied at the place of consumption.
A sub-group having officials of central and state of the empowered committee have been given the task of framing the rules.
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