Home >Companies >Start-ups >Flipkart challenges Gujarat entry tax on online sales in court

Ahmedabad: The Gujarat high court on Thursday issued a notice to the state government on a petition filed by online retailer Flipkart against an entry tax in the state on the goods bought through e-commerce portals.

The division bench of chief justice R. Subhash Reddy and Justice V.M. Pancholi scheduled the next hearing for 9 June.

Flipkart has claimed the tax is discriminatory, because no such tax is imposed on goods brought into Gujarat thorough other modes of sale. It moved the HC after the Gujarat government amended the law to levy entry tax on goods purchased through e-commerce portals, apparently to provide a level-playing field to the traders and retailers in the state.

The Gujarat Tax on Entry of Specified Goods into Local Areas (Amendment) Bill, 2016, was passed on 31 March. Now 15% entry tax is levied on online purchases.

Flipkart’s contention is it does not sell any product itself but only provides an online platform to manufacturers/ traders, so the tax is unjustified.

The new law amends the word “importer" to cover those who “bring or facilitate to bring any specified goods for consumption, use or sale in Gujarat from any part of the country using online platforms."

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