Which Products Can Be Sold Online Without a GST Number?

In many countries, certain products can be sold online without requiring a Goods and Services Tax (GST) registration. This is determined by factors such as annual turnover and the nature of the goods. This article provides a comprehensive guide to help online sellers navigate these requirements.

Small Scale Sellers

If your annual turnover is below the threshold limit, you may not need a GST registration. For example, in India, the threshold limit is 20 lakhs for most states. However, specific requirements can vary by location. It is essential to check local regulations to understand the exact threshold limits in your region.

Exempt Goods

Some goods are exempt from GST and can be sold online without any registration. These include:

Certain agricultural products such as fresh fruits and vegetables Unprocessed food items like uncooked grains, flour, and unprocessed coffee beans Educational services Certain healthcare services for preventive and rehabilitative treatments

Handmade or Artisanal Products

If you are selling handmade or artisanal goods, and your turnover is below the threshold limit, you may not need to register for GST. However, always verify local regulations to ensure compliance.

Digital Products

Selling digital products like e-books, online courses, and software generally requires checking local regulations as the rules can vary. For instance, in India, specific rules apply to the GST registration for digital products. It is recommended to consult local authorities to understand the current requirements.

Services

Some services may not require GST registration, especially if the turnover is below the threshold limit. However, it is crucial to comply with other local business regulations such as obtaining a business license.

Important Considerations

Local Regulations: Always check the specific regulations in your country or state as they can vary widely. Compliance: Even if you do not need GST registration, you may still need to adhere to other local business regulations such as obtaining a business license. Voluntary Registration: Some sellers choose to register for GST voluntarily, even if not required, as it can enhance credibility and allow for input tax credit.

For E-Commerce Platforms

If you plan to sell on e-commerce platforms like Amazon, Flipkart, or eBay, it is mandatory to be registered under the GST Act 2017 and possess a valid GST Identification Number (GSTIN). Even if you are selling exempted goods under the GST Act 2017, you can proceed to sell these goods and services online on your own website without being registered.

Exempted Goods under GST Act 2017

While the following is not an exhaustive list, it provides a good starting point to identify goods that are exempted from GST:

Fresh fruits and vegetables, such as melons, grapes, fresh ginger, and garlic Unprocessed agricultural products like corn, wheat, soybeans, rice, and maize Raw materials such as silk waste, raw jute, and unprocessed wool Tools and instruments, such as agricultural tools and hearing aids Contraceptives and medical devices, such as organic manure and books

Mandatory GST Registration for Online Sellers

Entrepreneurs selling online on e-commerce operators like Amazon, eBay, or Flipkart are required to be registered under the Central Goods and Services Tax (CGST) Act 2017. These online retailers must be registered regardless of their turnover. The provisions for registration include:

Persons who supply goods through such e-commerce operators who are required to collect tax at source under Section 52 Classification of all electronic commercial operators under Section 51

Rate of GST on Online Sales

The rate of GST levied on products sold online varies from 0 to 28%. Goods such as books, fresh fruits and vegetables, and raw silk are exempted from GST. For products with higher tax rates, refer to the Harmonized System Nomenclature (HSN) codes to determine the applicable tax rate.

Conclusion: Understanding and complying with GST regulations is crucial for online sellers. Always consult with a tax professional or accountant to navigate the specific requirements and implications for your situation.