Senior Congress leaders shielded e-commerce sites from VAT says JD(S)

Bengaluru: E-commerce business establishments like Amazon, Flipkart and Snapdeal were being kept out of the VAT regime because of pressure from Congress bigwigs like AICC General Secretary, Digvijay Singh, and former ministers P Chidambaram and Veerappa Moily, who had stakes in them, alleged JD(S) spokesperson, Ramesh Babu here on Wednesday.

Speaking to reporters, he also claimed that Commercial Tax Commissioner,  Ajay Seth, was asked to go on leave as he refused to toe the line of the government and issued notices to these companies demanding they pay VAT.

“When under section 35 of the Karnataka Value Added Tax Act 2003 every dealer with a turnover of Rs 50 lakh and above is supposed to pay VAT, these e-commerce companies, which have a  turnover  running into crores are exempted. The commercial tax department has issued notice to Amazon asking for over Rs 150 crore in VAT, but the state government has been bringing pressure on it to go slow,” Mr Babu charged, alleging that Mr Digvijay Singh, Mr Chidambaram and Mr  Moily,  had a stake in these e-commerce companies and  had given both oral and written instructions to the state government to exempt them from VAT.

“When Chief Minister Siddaramaiah orally instructed Mr Ajay Seth to go slow in the matter, he refused to listen and so was asked to go on leave from November 11. We have reliable information that these AICC office bearers have investments in these e-commerce companies,”  Mr  Babu claimed.

Noting that e-commerce trade was expected to have a turnover of over Rs 60,000 crore by 2016, fetching the state government  revenue of betweeen Rs 1500 to Rs 2000 crore  every year, the JD(S) leader deplored that despite this , an honest officer was being punished for merely doing  his job.