BENEFITS OF GST FOR E-COMMERCE AND THE NEED FOR MAGENTO
GST EXTENSION MODULES
Over the years, E-Commerce sector has grown phenomenally when it comes to revenue and the total number of shipments. Continuing to be a budding sector in India, it has become more promising with the introduction of GST. Prior to this, there was a series of taxes that were applicable to e-commerce businesses. The indirect taxes applicable for this sector have been much of a drawback than being the driver for growth. Also, there has been a constant confusion on categorizing the offerings into goods or services and hence the confusion in charging VAT, CST or service tax. The different taxes levied to e-commerce were:
Value Added Tax (VAT)
Sales Tax
Service Tax
Entry Tax
Abiding by the various laws ruling all the above taxes had become cumbersome and challenging for the e-commerce sector and GST would bring about the wave of relief when it comes to Tax filing. The cascading taxes falling under the previous taxation system would be removed for good and a consolidated tax regime would be followed. This reduction in cascading effect of taxes would enable a seamless credit across the supply chains and bring down the overall cost of supplies. Under GST the taxes will be harmonized at both central and state level rooting for the ‘one nation, one tax'
tagline that has been vaguely defining GST.
Another issue with the earlier tax regime was the entry taxes imposed by some states on the movement of goods across state borders. This has been the biggest reason for increase logistics cost for the e-commerce companies. With the new GST laws, the interstate ferrying costs are estimated to go down by 20% of the existing cost.
Due to entry taxes levied by different states, big e-commerce companies set up warehouses in different states to save on extra logistics cost. With GST removing all such interstate taxes the need for setting up multiple warehouses goes down for these companies and they can save on inventory and warehousing costs. Also, due to liberalization in interstate taxes, the orders are expected to be delivered faster.
To ensure complete transparency in the online marketplace, the new rules laid as per GST makes it mandatory for all the merchants selling goods or services online to register under GST. The information provided by these merchants is verified to avoid any discrepancies in payments and service quality. The verification process includes mapping information provided by the merchants with the information provided by big online marketplaces. The sales numbers and details are also required to be reported by both merchants and online marketplaces. This helps in avoiding any misrepresentation or fraud in books of accounts. The transparency in these marketplaces ensures and maintains the quality of sellers and merchants selling goods and services online.
The incorporation of GST functionality does not require any changes in the structure and design of the existing e-commerce website of the business, hence there is not even a minor change in the way customers experience surfing and shopping on these online platforms. There is no need to alter or create a new website from scratch; Codilar presents the GST extension to help e-commerce businesses align their online platform with the GST norms and regulations.
Codilar’s Magento based GST extension is compatible with the existing Magento websites of the e-commerce businesses, and hence, smoothly assimilates with the site. It does not hamper the functioning of the site and quickly aligns with the system. The GST extension has various features and provides various changes required in the various functions of the Magento e-commerce website.
Invoice generation, payment collections, updated product catalogues and monthly tax filing are certain areas which require adequate changes to adapt to GST regime and the GST module provided by Codilar solves the purpose. Other key features include:
automatic calculation of SGST, CGST, and IGST which is added to all transactional
emails and pdf files
updating the order and invoice templates that are compliant with GST standards
Admin configuration to enter GST number specific to the online store
Attaching the Invoice and order e-mails or pdf files are with the GST number
The Magento based GST extension provided by Codilar is the simplest and most effective solution to update your e-store with GST standards. It enables a smooth and time saving up gradation of the e-commerce website without hampering its functionality. It is an error free and fool-proof module which makes you Magento ready effortlessly and within no time!