Service Providers acting through an electronic commerce operator having turnover less than twenty lakh rupees in a year are not required to obtain registration under GST laws
Service Providers acting through an electronic commerce operator, i.e. providing service through an electronic commerce operator, and having turnover less than twenty lakh rupees in a financial year are exempted from obtaining registration under GST laws.
Essentials of this provision:
- Service Provider is providing service through an electronic commerce operator.
- Only service providers are subject to this provision and not suppliers of goods.
- Services must be other than the services notified in terms of sub-section (5) of section 9 of the CGST Act, where ECO is required to pay GST on deemed basis and required to collect TCS.
- Turnover means aggregate turnover on all India basis is not exceeding ten lakh rupees in a financial year for service providers in special category States and not exceeding twenty lakh rupees in a financial year for rest of the States of India
Relevant Extract of Notifications & Act:
Notification No. 65/2017 – Central Tax dated 15th November, 2017 read with Notification No. 6/2019 – Central Tax dated 29th January, 2019:
“The persons making supplies of services, other than supplies specified under subsection (5) of section 9 of the said Act through an electronic commerce operator who is required to collect tax at source under section 52 of the said Act, and having an aggregate turnover, to be computed on all India basis, not exceeding an amount of twenty lakh rupees in a financial year, as the category of persons exempted from obtaining registration under the said Act.
Provided that the aggregate value of such supplies, to be computed on all India basis, should not exceed an amount of ten lakh rupees in case of “special category States” as specified in the first proviso to sub-section (1) of section 22 of the said Act, read with clause (iii) of the Explanation to the said section.”
Sub-section (5) of Section 9 of The Central Goods and Services Tax Act, 2017:
“(5) The Government may, on the recommendations of the Council, by notification, specify categories of services the tax on intra-State supplies of which shall be paid by the electronic commerce operator if such services are supplied through it, and all the provisions of this Act shall apply to such electronic commerce operator as if he is the supplier liable for paying the tax in relation to the supply of such services.
Provided that where an electronic commerce operator does not have a physical presence in the taxable territory, any person representing such electronic commerce operator for any purpose in the taxable territory shall be liable to pay tax.
Provided further that where an electronic commerce operator does not have a physical presence in the taxable territory and also he does not have a representative in the said territory, such electronic commerce operator shall appoint a person in the taxable territory for the purpose of paying tax and such person shall be liable to pay tax.”
Special Category States as on 13/02/2019:
States of Manipur, Mizoram, Nagaland and Tripura.
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