The govt is going to tax e-commerce. Can they survive it?

Thousands of wires. Millions of computers and devices connected together. The result is that the world has become smaller and smaller. We now live in a world where a business idea can start from something as small as a Facebook or Instagram post. The seeds of the business can be started by any individual who has a functional phone and an operational social media account.

Post a few photos of customised drinking cups or scented candles from the suburbs of Lahore and pretty soon the city and country can start to place their orders. Live streaming videos of women hawking cutlery they have collected from Shah Alam market are easy to find where customers can reserve and book whatever they like and see it dispatched to them within 2 to 3 working days. Confirm the order through Whatsapp by sharing the relevant details and voila, you have a burgeoning business ready to take off.

Either get the money transferred into your mobile wallet or allow the customer to pay on delivery and you have established a whole supply chain which starts from procuring the goods, marketing them to relevant customers and then sending them to the customers’ doorstep with the use of courier services while the money is sent to your mobile wallet. Turn back the clock a few years and all these ideas were not even in the figment of anyone’s imagination. Now it seems these are the starting point of the next big thing. 

People owning and running their own businesses from their homes used to be rare. That is no longer the case. Cities, towns and even underdeveloped villages are now seeing a movement towards online commerce which is growing in size day-by-day. All businesses, big and small, are now turning towards e-commerce in order to build or sustain themselves in the new business environment and the digital revolution is slowly taking over.

With the popularity of the sector, however, the industry is now coming under focus of the government as well. As the quantum of this industry continues to grow, the recent budget has proposed new taxes and compliance that needs to be carried out by these e-commerce platforms. The impact of these measures will take time to be realized. The truth is that this will end up negatively impacting the sector which is just starting to get up on its feet. The question then raised is whether the industry can survive the impact.