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Monday , 20 November 2017
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Online sellers slash rates to clear stocks before new tax regime kicks in

Online sellers are offering discounts on their products to clear stocks before new tax regime kicks in otherwise huge loss for them 

Watches ,sports equipments attract 28 percent GST .The MRP of these goods is based on pre-GST tax rates

Only a brand or manufacturer can change the MRP but traders can do nothing with old stocks with higher GST rates

“If we recall the inventory from the warehouses of e-marketplaces to get the MRP changed by the brands, we have to bear the recall fee of around Rs 25,000 for 1,000 units to get it sorted and sell it after GST roll-out. If we sell it as is in the new tax system, we’ll be doing so at a loss,” says All India Online Vendors Association (AIOVA)

“Everyone is trying to clear their stock pre-GST so that they won’t have to incur any additional cost on their stock after GST. Aa few days ago also there was a sale on Flipkart, and everybody is putting out more ads so that stocks can be liquidated,” says an AIOVA spokesperson.

There is no clarity either from the government or e-commerce platforms regarding GST

Its not only online sellers but also offline sellers trying to get rid of stocks 

“Though there are talks that the government will offer rebates on stock sold during the transition period, it is quite difficult to carry on with the stocks because whatever rebate is going to come up later on will be applicable only till a certain period of time,” said an ECSAI spokesperson.

“We are studying the GST developments and currently our priority is to enable our systems to be geared up for compliance with GST regulations,” said an Amazon India spokesperson.

“As and when details emerge, we incorporate those changes in our system which is very nimble and technologically flexible to incorporate new rules in the system and be totally compliant,” said Shop-Clues vice president (product management) Arun Goel.

Flipkart and Snapdeal did not respond to queries

 

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