GST is important for Meesho‘s legal, tax, and national reach, but it’s not strictly necessary for tiny, intra-state businesses. For companies with a turnover of more than ₹40 lakh (₹20 lakh in some states), it is crucial, as it allows sellers to ship goods within India and claim Input Tax Credit (ITC).
Important Factors for Meesho’s GST Importance:
- Interstate Sales: Sellers are only allowed to sell inside their own state (intra-state) if they do not have a GSTIN.
- Input Tax Credit (ITC): By registering for GST, sellers can claim ITC on taxes paid on purchases of inventory or raw materials, thereby lowering overall expenses.
- Trust and Compliance: To ensure legal compliance, tax payments are verified, tracked, and managed using a GSTIN (or Enrollment ID for non-GST).
- Greater Turnover Limit: Companies can sell without GST if their turnover is less than ₹40 lakh (or ₹20 lakh or ₹10 lakh for some states), but registration is required if it exceeds these thresholds.
- Input Tax Credit (ITC) for Suppliers: A legitimate GST invoice is required if a provider who is registered under GST wishes to claim credit for their purchases.
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