The country's e-commerce segment has transformed India’s retail industry. While e-commerce traditionally included global brands like Amazon, over the past few years several direct-to-consumer (D2C) startups have also tapped the e-commerce market. According to a study by Bain & Co., the domestic ecommerce market is poised to grow past $160 billion by 2028, from an estimated $57-$60 billion in 2023. Ahead of the interim budget, e-commerce start-ups anticipate measures in terms of tax subsidy and increased financial assistance to MSMEs that can further catapult the growth of the e-commerce sector.
Shaily Mehrotra, CEO & founder, Fixderma, anticipates tax concessions and custom duty exemptions ahead of the interim budget. "Majority of booming e-commerce brands are MSMEs and startups. Hence we expect tax concessions and necessary custom duty exemptions," says Mehrotra.
“In the retail segment, we expect budget 2024 to offer tax breaks and incentives to revive consumer spending and boost retail footfall, including raising personal income tax slabs and introducing temporary tax holidays. We can also expect selective incentives to promote sustainability and innovation,” she adds.
Reflecting the same, Nitya Sharma, founder and CEO, Simpl, anticipates easing financing options for MSMEs (micro, small and medium enterprises) in the interim budget.
“This year’s Vote on Account followed by the full year’s Union Budget should view startups as the sunrise sector, provide easy financing for sellers akin to MSMEs and open up more avenues in the era of Unbundling of E-commerce which has started with ONDC. We would expect a greater collaboration between the government and industry in further simplifying the Ease of Doing Business in India and resolving bottlenecks swiftly,” says Sharma.
According to Shreedha Singh, CEO & co-founder, The Ayurveda Company, subsidised loans in the interim budget would propel domestic growth and self-reliance.
Meanwhile, Kapil Makhija, CEO, Unicommerce, anticipates continued support for the facilitation of technology in the retail segment in the interim budget. “According to India’s vibrant retail sector, supported by the expanding e-commerce ecosystem, continues to evolve to meet the needs of its users. Over the years, the government has integrated technology tools to simplify taxation, streamline logistics and promote the use of e-commerce to boost exports. We anticipate continued support of the government in facilitating the use of technology to make India’s retail sector future-ready and aligned with growth opportunities,” Makhija says.
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