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    Ease of cross-border transactions with GST will be game changer for e-commerce: Ashish Goel, Urban Ladder

    Synopsis

    "Each state requires a different set of documentation and that poses a lot of challenges in the market. But once GST comes into play next year, these problems will start becoming things of the past."

    ET Online
    The much-anticipated passage of the GST bill follows a protracted period of intense negotiations in the Parliament. Touted as a game changer for the e-commerce industry in India whose sustenance depends on the efficient transfer of goods across state borders, Ashish Goel, CEO and co-founder of Urban Ladder, shares his thoughts on the probable impact it could have on the company 's expansion plans and what the government may have missed out in the final bill. Excerpts:

    Economic Times (ET): Where do you think the government currently stands on the scale of 'ease of doing business'? How do you think the latest development will impact the entrepreneurship ecosystem in India?

    Ashish Goel (AG): From the standpoint of starting a business, GST may not necessarily have an immediate impact. But, it will come into play at a later stage when a startup looks to scale up and expand. That is the stage when enterprises begin to experience friction points a lot more. So GST will certainly help conduct businesses easier, and from that point of view it will boost the government's promise of 'ease of doing business' by creating a unified market that will allow free movement of goods across the country.

    ET: To what extent do you think GST will impact the e-commerce and consumer space in India? Why do you think it will be a game changer for these industries?
    AG: GST will create a huge impact for these two industries. The game changer here would be the ease of cross-border transactions. That has been a pain point for companies operating in these sectors for a long time. Each state requires a different set of documentation, service taxes etc and these pose a lot of challenges in the market. As a consumer e-commerce brand, our focus is on building a seamless supply chain and logistics network that will help us fulfil customer orders in different parts of the country.

    Second, GST's clarification on the taxation regime will greatly benefit marketplaces. Given the regulatory environment, a lot of e-commerce companies currently operate as marketplaces and the transparency on how the taxation regime will affect these aggregators is a big sigh of relief for them.

    ET: How will GST impact operations running under Urban Ladder? What difficulties has the company been consistently facing that should be resolved with the passage of this bill?

    AG: Our business revolves around furniture. So we have various goods being transported across the country on a regular basis. This essentially means that at every state border, we encounter a different documentation which we have no option but to adhere to. For instance, we may require a different set of documents when entering Karnataka as opposed to those we used when exiting Rajasthan.

    We also come across various indirect tax checkpoints at these borders. But once GST comes fully into play next year, these problems will start becoming things of the past. Additionally, it will also eliminate the cascading effect of taxes on customers which will bring in more efficiency in product costs.

    ET: Given that cross-border transactions have now been made a lot easier, is Urban Ladder looking to expand operations to other states in India?

    AG: That is a possibility. There are states in which we are not doing business today since opening every new state comes with its own set of challenges. Hence, we have preferred to stick to the states we currently operate out of and keep expanding within those rather than opening a new place. But that could change. We would love to be in cities like Bhopal, Indore, Lucknow, Kanpur etc.

    ET: What else, in your opinion, should have been included in the bill from the way it stands now?

    AG: I felt the taxation procedure could have been simplified further. We currently have a concept of Central and State GST - this could have been modified a bit. Nevertheless, this is a step in the right direction and hopefully it will be refined further in the next 3-4 years.


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