Kerala slaps tax fines on Indian e-tailers

Kerala government has slapped fines up to INR 54 crores on some the big players in Indian e-Commerce for evasion of sales tax in 2012-13 and 2013-14. The companies that face the penalty are Flipkart, Jabong, Myntra and Zovi. Flipkart will be paying the highest penalty which is approximately INR 47 crores while Jabong has been fined INR 3.89 crores, Myntra INR 2.23 crores and Zovi INR 36 lakh.

Some of the e-tailers had stopped delivery to few cities in Kerala as the state’s commercial taxes department had banned their cash on delivery (COD) mode. And after a brief time, COD service was resumed by these companies while the ban was still in place, according to some officials.

“Since the online retail firms do not have brick-and-mortar showrooms, their websites will be treated as showrooms that display products and prices. If the products are sold to local customers, regional taxes will be applicable. All transactions are taxable,” says a senior official from state’s commercial tax department.

Previously Karnataka had banned Amazon India from selling electronics and select other products from it’s warehouses located in the state.

Source: FE