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Govt may levy 50% in taxes and duties on products ordered from Chinese e-tailers

In its continuance crackdown to curb illegal imports, the Indian government has been planning to introduce 50% taxes and customs duties on products bought from Chinese e-comm firms.

The tax department is mulling to levy a series of taxes and duties including goods and services tax and customs duty.

It is planning to tax buyers, said an ET report.

It is looking to bring in payment gateways on board on the scheme and when the consumer pays the money, IGST and customs duty will be included in the price, it added.

Govt is yet to decide on nature of tax- whether it will be separate taxes or blended one.  The move would largely affect Chinese retailers such as Club Factory, AliExpress and Shein.

According to an estimate, close to 200k orders were placed every day through Chinese e-commerce platforms in India which escaped any form of taxes.

In December 2018, the Mumbai customs department had noticed multiple consignments of goods in the guise of gifts.

Following the incident, the govt had stopped the import of goods through Mumbai. Early this year, the government had imposed a clampdown on shipments of goods from Chinese e-commerce platforms to India as gifts.

The move was taken by the govt mainly to curb the rampant practice by Chinese e-tailers in the country to exploit loopholes in the present regulations. This led to over 50% downfall on courier shipments at Mumbai airport.

Ever since Chinese e-tailers arrival in India, they have become popular in the country in the last couple of years. All the e-tailers boast of having a huge user base in India.

However, small traders and domestic e-tailers had complained to the govt against Chinese e-tailers that they are taking advantage of the exemption from customs duties.

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