Ease of doing business for MSMEs: The GST council meeting concluded with a decision to allow unregistered small vendors to make intra-state supplies of goods via e-commerce starting in October 2024.
To facilitate the conducting process of e-commerce operation of the micro-entrepreneurs, the GST council had in its 48th meeting granted in-principle approval for allowing unregistered suppliers and composition taxpayers to make the Intra-state supply of goods through E-Commerce Operators (ECOs) by following the stipulated conditions specified in the GST Act and GST rules.
E-commerce sellers with a turnover of up to Rs 40 lakh and Rs 20 lakh in the supply of goods and services yet unregistered under the Central Goods and Services Tax (CGST) Act will be permitted to make intra-state supplies, with effect from October 1, 2024. The government has taken this step to ease the process of doing business for micro-small and medium-sized enterprises (MSMEs).
The council meeting, chaired by financial minister Nirmala Sitharaman, “approved the amendments to the GST Act and GST Rules, as well as the issuance of relevant notifications, to enable the same,” according to a media briefing on the outcomes of its 48th meeting.
Because the ECOs of e-commerce operators need time to align resources in order to begin functionalizing, the council declared that the scheme will be implemented on October 1, 2024.Â
With this detail, the GST registration waiver with a turnover of up to Rs 1.5 crore and getting registered under the GST composition scheme will be eligible to apply for e-commerce sellers. The scheme leads to reducing the compliance cost for small taxpayers with lower tax rates of 2 percent of turnover for manufacturers, 1 percent for traders, and 5 percent for restaurant businesses.Â
PM Narendra Modi on e-commerce
The Confederation of All India Traders (CAIT) on Saturday thanked Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman for executing the progressive decision on enabling the small unregistered vendors to achieve the intrastate supply of goods via the e-commerce portals.
CAIT national president B.C. Bhartia and Secretary General Praveen Khandelwal said this decision will empower the small traders to explore and achieve the targets as set by them whilst that paves the way for contributing to Digital India’s vision.
“Despite there being more than 8 crore small traders existing in the country, a larger number of traders are conducting business activities without GST registration as their annual sales are below the GST threshold limit.” Such traders will now be able to trade e-commerce. “E-commerce business in India accounts for approximately 10% of total retail, so this amendment to the GST Act and GST rules will significantly impede economic growth,” according to a statement.
