Tax on online advertisements bring discontent to e-tailers in Bangalore
With Budget 2014 re-introducing service tax on online and mobile advertising, e-commerce industry facing the direct brunt of it has now adopted a wait and watch strategy. But they feel that the government needs to go extra mile to support the nascent industry which has got immense potential.
“It would have been encouraging for the industry, had the tax holiday continued a little longer like other sectors including software industry,” emphasised Hitesh Oberoi, CEO of naukri.com, country’s leading job search portal.
Sharing similar sentiments, Praveen Sinha, co-founder and MD of Jabong.com, a well-known fashion and lifestyle portal said, “Our industry is new and yet to stablise. None of the ecommerce companies are profitable till today. Government should play the role of an enabler for our industry that holds the future.”
Two years back in 2012-13, online and mobile adverts were added to the negative list of service tax, thereby exempting the medium from tax. Broadcast media including radio has always been under service tax and print has always been exempted.
Prominent e-commerce players, though believe that in the mid and long-term such external factors like service tax will not dent their business.
Source: economictimes
