CAIT writes to PM about GST issues, alleged violation of e-commerce rules by e-tailers

Ahead of its ‘Bharat Bandh’ call on February 26, traders’ body CAIT on Sunday wrote to Prime Minister Narendra Modi raising issues related to the GST regime, and alleging violation of e-commerce rules by major e-tailers. In its letter to the prime minister, the Confederation of All India Traders (CAIT) called for setting up of a “special working group” at the central level comprising senior officials, CAIT representatives and independent tax experts to review the GST structure and make recommendations to the government. It also suggested that a “District GST working Group” may be constituted in each district to monitor smooth GST implementation and to take steps for widening of tax base and augmentation of revenue.

In the letter, CAIT said that a few recent amendments in GST have given “arbitrary and unfettered powers” to the government officials. It said this goes much against the PM’s mission for ‘minimum government, maximum governance’, and these amendments have created a state of ‘tax terrorism’ in the country. “The principle of natural justice has been greatly violated through such amendments where the traders have been denied any sort of show-cause notice or opportunity of hearing before taking any penal action,” the traders’ body said in the letter to PM. It alleged that the domestic e-commerce landscape has been greatly vitiated by some major e-commerce companies “who are continuously and openly violating the FDI policy, law and rules without any fear of law”. They are indulging in predatory pricing, deep discounting, loss funding, controlling inventory and sale of branded products, CAIT alleged.

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“These e-commerce companies have found various escape routes in Press Note No.2 of the FDI policy and therefore, a fresh Press Note blocking all escape routes and abolishing all such provisions that may prompt these companies to violate the rules or policies should be prepared,” CAIT said. It also called for setting up of a regulatory authority for the e-commerce sector. Such authority should be empowered with due rights to take any penal action against those who violate the law or policy, the traders’ body said. Besides, it suggested that a robust e-commerce policy should be formulated and released in a time-bound manner prescribing defined parameters for e-commerce business in the country.