The New GST Scheme: How Will It Impact Your Online Business?
As per government data, India has more than 93 lakh registered micro, small and medium enterprises (MSMEs). These enterprises are pan-India and contribute hugely to making India grow towards self-reliance, following the government's push for an Atmanirbhar Bharat. To support the MSME sector, the government has introduced new measures to make doing online business easier.
Ways in which the new GST regime helps MSMEs:
There are multiple initiatives that the government has launched to remove various bottlenecks for e-commerce in India.
Earlier, a survey released by Confederation of All-India Traders (CAIT) noted that mandatory GST registration for selling online was a huge reason for small businesses to stay out of e-commerce. 72% responders of the survey believed that e-commerce was hugely beneficial to their business, but 66% pointed out GST as a big hurdle.
But starting from January 1, 2023, the GST Council has decided to waive mandatory registration for small online businesses. This means that any online business with a turnover of lower than Rs. 40 lakh for goods, or Rs. 20 lakh for services, need not register for GST.
For small businesses looking to go online, this is a huge boost. This step therefore brings more parity for online sellers with respect to offline sellers. It will allow new businesses to enter the e-commerce market, which in turn will help them scale, sustain, and grow. Other GST initiatives this time includes:
Initial GST exemption threshold of Rs. 20 lakh has been increased to Rs. 40 lakh for goods.
Composition dealers are allowed to supply services.
Goods manufactured and/or used in the MSME sector have been given a better and preferential rate treatment.
Mandatory registration of small online vendors is not necessary if the turnover is lower than Rs. 40 lakh for goods, or Rs. 20 lakh for services.
The entire taxation process has been made much simpler for small and medium businesses.
With an estimated 5 crore MSMEs currently unable to sell via e-commerce due to GST requirements, this exemption is game-changing. For artisans, weavers, handicraft makers, artists, homemakers, retailers and small manufacturers, access to online commerce will become much easier.
On MarketCentral, small businesses can look forward to seamlessly selling their products online, finding suppliers for their business, networking with other business owners, and now even managing their delivery and logistics. With these new rules coming into effect, take your business online free of cost at MarkeCentral- start ahead of competition, build your customer base, and increase your business revenue!
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