Nitin Gupta, Chairman, CBDT
| Photo Credit: KAMAL NARANG
The Income Tax division has clarified the applicability of TDS liability of e-retailers buying and selling via the federal government’s open community digital commerce.
As per the FAQ issued by the Central Board of Direct Taxes (CBDT) on Thursday, a 1% TDS must be deducted from the gross sale quantity after together with comfort/packaging/delivery charges as charged by e-commerce buying and selling platforms for the order positioned on ONDC.
As ONDC or Open Network for Digital Commerce is a brand new initiative of the Department for Promotion of Industry and Internal Trade (DPIIT), the CBDT had acquired representations looking for readability on who needs to be liable for Tax Deducted at Source (TDS) compliance beneath I-T legal guidelines.
Under the regulation, each e-commerce operator is required to deduct TDS on the price of 1% of the gross sales quantity of items/providers bought via its platform.
The CBDT has clarified that in a state of affairs the place a number of e-commerce operators (ECOs) are concerned in a single transaction via the ECO platform, the TDS compliance is to be executed by the provider aspect, who lastly releases the cost to the provider.
Incorporated on December 31, 2021, ONDC is a Section 8 firm.
It is an initiative of the DPIIT to create a facilitative mannequin to assist small retailers take benefit of digital commerce. It isn’t an utility, platform, middleman, or software program however a set of specs designed to foster open, unbundled, and interoperable open networks.
