To guarantee that consumers get the GST savings, Flipkart and Amazon have implemented a number of communication and technological improvement initiatives.
During their respective early “festive sale” days, Amazon and Flipkart, India’s two largest e-commerce sites, together, gave consumers nearly Rs 300 crore in benefits from the GST rate decrease.
In a statement, both businesses informed Moneycontrol that they had taken a number of steps to guarantee that “GST savings are passed on to clients” after September 22, the day the new GST rates went into effect.
“Through its marketplace platform, Flipkart has already enabled merchants to pass on over Rs 200 crores in GST benefits to its customers,” the company told Moneycontrol during the early holiday sale days.
Additionally, Amazon said that during its “Great Indian Festival,” vendors were able to pass on GST advantages of more than Rs 100 crore in apparel, appliances, necessities, and other relevant categories.
Two primary slabs of 5 percent and 18 percent have replaced the old multi-tier structure under the new goods and services tax system, which went into effect on September 22. Lowering the cost of more than 300 everyday products and lessening the tax burden on average people are the goals of the largest indirect tax reform.
By educating seller partners and offering a streamlined seller dashboard with automatic backend updates of the new GST slabs, Flipkart, a domestic e-commerce platform, has taken a number of communication and technological advancement steps to guarantee that the GST reductions are passed on to customers, making it simpler for them to accept the changes, the company stated.
‘GST Bachat Utsav,’ a special storefront effort that emphasizes GST reforms-linked savings for clients, is another way that Flipkart has been marketing the pricing advantages. The e-commerce giant is actively collaborating with our merchants via these actions to guarantee that the advantages of the GST reductions are “effectively transferred into reduced consumer costs.”
Moneycontrol revealed on Tuesday that even after the GST reduction went into effect, the government has asked several major e-commerce companies to respond to their pricing increases for a select commodities. A government official claims that three days ago, a major e-commerce company mistakenly displayed greater pricing after the reductions in the GST rate.
“As part of our commitment to helping sellers and easing compliance with government regulations, Amazon has created procedures to help sellers migrate easily to the new GST rates beginning September 22,” the company said.
“Amazon has proactively assisted sellers with tools and information to evaluate and maintain accuracy throughout their listings, but sellers are still in charge of making sure the right GST rates and Product Tax Codes (PTCs) are applied to their items. For a few product categories, Amazon has automatically updated the PTCs and GST rates on sellers’ listings wherever feasible. In their response, Amazon informed Moneycontrol, “We have also provided merchants with extensive tools, such as seminars on comprehending the subtleties of GST tax laws.
“We have made it possible for merchants on ‘Amazon.in’ to easily pass on the advantages of GST reductions to consumers in relevant categories, even though they still have total control over product price,” the statement said.
Moneycontrol said Tuesday that during their major sales periods, the Great Indian Festival (GIF) and Big Billion Days (TBBD), Amazon and Flipkart had record traffic and strong demand. It seems like this will be the largest festival season in the industry’s history, thanks to a combination of high-value sales, Gen Z consumers, and GST reductions.
According to a survey by market intelligence company Datum Intelligence, online festival season sales reached Rs 60,700 crore in the first week, up 29% year-over-year, making it the biggest beginning ever for India’s digital retail industry.
With almost half of that already recorded in the first week, the company anticipates that this year’s festive sales would surpass Rs 1.2 lakh crore. This contrasts with sales of around Rs 1 lakh crore in 2023 and Rs 81,000 crore last year.