India's OIDAR rule skips the GST turnover threshold

The workload

A non-resident business supplying what India's tax law calls 'online information and database access or retrieval services,' OIDAR, to a customer in India has to sort those sales the same way Japan's rule does, but with a different consequence: there is no revenue floor to clear first. The Central Goods and Services Tax Act, 2017, section 24(xi), lists every person supplying OIDAR services from outside India to a person in India, other than a registered person, among the categories required to register compulsorily, overriding the turnover-based registration threshold that applies to ordinary suppliers. Verified, quoted from the Act.

What the documents show

Verified: the Integrated Goods and Services Tax Act, 2017 defines OIDAR at section 2(17) as services whose delivery is mediated by information technology over the internet, essentially automated and involving minimal human intervention, naming cloud services, e-books, digital content, data storage and online gaming among its examples. Verified: the same Act defines a 'non-taxable online recipient' at section 2(16) as an unregistered person, government body or individual receiving OIDAR for a purpose other than business, the Act's own line between a consumer sale and a business sale. Verified: section 14 makes the offshore OIDAR supplier the person liable to pay integrated tax when the recipient is a non-taxable online recipient, and requires that supplier to take a single registration under the Simplified Registration Scheme. Read together with the CGST Act's compulsory-registration clause, a second document confirms the same B2C/B2B line drawn two ways: no threshold for consumer-facing OIDAR sales, and ordinary reverse-charge treatment for a sale to a GST-registered Indian business, which falls outside the 'non-taxable online recipient' definition entirely.

The operating cost

The statute's cost is the obligation itself rather than a stated fee: single registration under the Simplified Registration Scheme, direct integrated-tax payment on every consumer-facing OIDAR sale into India, and, where the supplier has no physical presence or representative in India, appointing a person there to pay the tax on its behalf, under section 14(2)'s second proviso. The Act does not state a current OIDAR tax rate in the text sourced here, and this entry does not supply one without checking CBIC's current rate notification directly.

The stop condition

Editorial: because compulsory registration under section 24(xi) is not turnover-gated, the obligation does not end by falling under a revenue line the way Canada's or Australia's does; it ends only when the business stops supplying OIDAR services to non-taxable online recipients in India.

• Is every Indian customer classified as a 'non-taxable online recipient' or a registered business under the Act's own test, not by self-declaration alone?
• Has the current OIDAR tax rate been confirmed against CBIC's own notification rather than a remembered figure?
• If sales are made through an intermediary platform, who does the Simplified Registration Scheme treat as the liable supplier?

India's statute answers a question Canada's and Australia's leave to a dollar figure: for OIDAR sold to a consumer, there is no minimum size of business the law exempts.