In the backdrop of Karnataka government sending licence cancellation notices to merchants selling through Amazon India, Nasscom today said the state should work towards catalysing economic growth and remove impediments to e-commerce growth.
"As a general proposition, we have been advocating that impediments to the growth of e-commerce should be removed, and on the contrary the government should do what they can to catalyse economic growth," Nasscom President R Chandrashekhar he told reporters at an event here.
The state tax department has sent notices to third party merchants working with Amazon India, directing them to stop storing their products in Amazon's Bangalore fulfilment centre.
The tax authorities apparently claim that Amazon should pay the sales tax for all the orders through its fulfilment service since they believe that Amazon owns these goods for all "practical" purposes.
Amazon, however, claims that it is just a service provider and doesn't own goods at any point of sale due to which it is not liable to pay this tax.
Chandrashekhar said e-commerce brings in efficiency in the
market and increases the pace of the economic activity and thereby adds to the Gross Domestic Product.
"The use of broadband and all such services are believed to contribute as much as two per cent growth to the GDP, which is really huge," he added.
Chandrashekhar said according to a study, which will be unveiled very soon, the impact of such technologies on economic development will be dramatic. "We have some studies which will be unveiled very soon which will show the impact of such technologies on economic development can be really dramatic," he said.
"Therefore, to realise that benefit I think we need to work on all these fronts - on regulation; on taxation; on infrastructure and also on the whole innovation ecosystem in the country because they will create the services; they will create the technology.
" E-commerce will create business models which will drive all of these. These are the four key pillars of growth," he added.
