Did you know India’s e-commerce market is expected to reach US$99 billion by 2024? This makes India the second-largest e-commerce market, just behind the US. As the digital market grows, so does the need for tax compliance. The GST registration process for e-commerce operators is now essential for legal and smooth business operations. The Central Board of Excise & Customs (CBEC) has set up special rules for e-commerce GST registration. This is because the sector is growing fast and has complex tax issues. If you sell online or plan to start an e-commerce business, knowing these rules is crucial for your success. Now, e-commerce business tax compliance is a must. Section 24 of the Central Goods and Services Tax Act, 2017 requires all e-commerce operators to register for GST. This includes collecting a 1% tax on each transaction, except for exempted goods and services. As an e-commerce operator, you must collect Tax Collected at Source (TCS) at a maximum rate of 1% on the ne...
New Delhi: The Supreme Court rejects MSME plea to entertain a petition by micro, small, and medium enterprises challenging a rule under the Income Tax Act that restricts them from extending credit to buyers beyond 45 days. Background Section 43B(h) of the Income Tax Act is aimed at regulating credit extension practices among MSMEs. This rule ensures timely payments and addresses working capital shortages in the sector. According to this provision, if an MSME registered under the Micro, Small, and Medium Enterprises Development Act, 2006 (MSMED Act) allows a credit period of over 45 days to a buyer when selling goods or services, it faces penalties. These penalties include compounded interest penalties at three times the bank rate set by the Reserve Bank of India (RBI). Moreover, businesses risk losing the ability to deduct payments made to MSMEs from their taxable income. Concerns Raised Some MSMEs have expressed concerns that this provision might lead larger buyers to bypass small an...