New GST Bill will hold Facebook, Twitter responsible for hosted content: IAMAI
- July 1, 2016
- Posted by: Indirect Tax Professionals
- Category: News
The new Goods and Services Tax Bill will put online intermediary platforms such as Facebook, YouTube, Twitter and online review websites in a precarious position because it holds them responsible for the content they host, said the Internet and Mobile Association of India.
“The new GST Bill clubs all intermediaries as ‘agents’ who ‘carries on the business of supply or receipt of goods and/or services on behalf of another'(emphasis added) and clubs these entities together with commission agents, brokers, etc,” said IAMAI in a statement.
The safe-harbour provisions under Section 79 of the Information Technology Act, 2000 say that barring certain conditions, “an intermediary shall not be liable for any third party information, data, or communication link made available or hosted by him”.
This means that services that host third party content- Facebook, Twitter, LinkedIn, Zomato and so on- are not liable for the contents uploaded or posted by users under the said provision.
However, the new GST Bill identifies an agent as “a person who carries on the business of supply or receipt of goods and/or services on behalf of another, whether disclosed or not and includes a factor, broker, commission agent, arhatia, del credere agent, intermediary or an auctioneer or any other mercantile agent“.
According to the Bill, these websites and platforms are identified as agents acting on behalf of users and hence will be liable for all videos hosted on its platform.
“This would effectively stop free and easy hosting services that the platform offers. Similar restrictions would be applicable for other services like social networking sites, online marketplaces, etc. In short, doing business in India just got complicated for Internet Service providers,” said IAMAI in a statement.
The IAMAI will be detailing over this week, the issues of concern to internet economy in the new GST Bill.
“The provisions for intermediaries in the New GST Bill are in clear contradiction with the provisions for ‘digital intermediaries’ as recognised by the IT Act, 2000,” it said on Tuesday. “If the internet economy is really expected to gain momentum in India, the government needs to address this inconsistency by reinstating the ‘digital intermediary’ and ‘safe-harbour’ provisions for the sector,” the industry body added.
Source: The Economic Times