CAIT demands luxury tax on quick commerce

A luxury tax has been proposed on purchases made through the quick commerce platforms by traders body.

According to the Confederation of All India Traders (CAIT), quick commerce platforms offer convenience to customers by providing rapid delivery of items, therefore, should attract luxury tax.

The CAIT's proposed demand will be submitted to the Ministry of Consumer Affairs.

Additionally, the trader's body demanded enforcement of foreign direct investment (FDI) and e-commerce policies under the Consumer Protection Act. CAIT has also urged that quick commerce platforms should be mandated to bring transparency in the algorithm, pricing, and seller selection.

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CAIT also laid down demands to create an independent regulatory body to prevent anti-competitive pricing practices and deep discounting.

CAIT, along with representatives from the All India Consumer Products Distributors Federation (AICPDF) and the Organised Retailers Association (ORA), has tabled their interest in favour of pro-kirana stores policies.

According to AICPDF, around 10 lakh Kirana stores have shut down their operations in the last two years because of the competitive pricing practices by quick commerce platforms such as Blinkit, Zepto, and Swiggy Instamart.

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The bodies collectively said that quick commerce firms cannot influence the price of goods.

Dhairyasheel Patil, national president of AICPDF and senior vice-president of CAIT alleged that 10 lakh shops have been shut due to the rapid penetration of quick commerce companies in over 100 Indian cities.

"Going forward, we fear the pace of these closures will increase as operations become unviable due to rising costs and lack of business," Patil added.