Marketplaces have a TDS job for vendors

BENGALURU: The Union government’s move to draw small vendors and service providers on e-marketplaces into the tax net could raise compliance costs that may then be passed onto consumers, said industry executives. On Saturday, the government mandated online marketplaces, which includes companies like Flipkart, Amazon, Uber and UrbanClap, to deduct 1% tax at source while crediting payments to vendors on their platforms. This charge will be applicable from April 1.

This will be in addition to e-marketplaces already deducting 1% tax at source, as part of the Goods & Services Tax (GST), on behalf of the seller or service provider.