A Socio-Economic Analysis of Taxation Issues in India’s Expanding E-Commerce Sector

Abstract

The explosive growth of the ecommerce industry in India has revolutionized the economic landscape of the nation, fostering digital commerce, consumer convenience, and employment opportunities. This growth has, however, created tax policy challenges for businesses and consumers, and also great complexity for the policymaker. The objective of the present study is to examine socio-economic impacts of tax implication of growing ecommerce industry in India. It examines critically the effectiveness of the prevailing tax regime, especially the Goods and Services Tax (GST), Tax Collected at Source (TCS) and the Equalisation Levy including compliance obligation for online transactions and marketplaces. There is an additional examination of the problems of tax evasion, ambiguity in regulations, interstate transactions and the compliance burden on small businesses as well as start-ups. The study aims to analyze how taxation affects e-commerce growth, pinpoint areas for improvement and suggest tax reforms that can enhance the transparency, fairness, and pro-growth of e-commerce taxation in India.