Small online sellers may soon be exempted from having to register for services tax (GST), a government official aware of the discussions said, marking a structural shift in India’s five-year-old indirect tax regime.

The central and state governments believe such a move would vastly expand the potential reach of small enterprises through e-commerce, the official said on condition of anonymity.

Currently, physical sellers need GST registration only if they have annual sales of more than  ₹40 lakh, while all online sellers compulsorily need GST registration irrespective of turnover. The proposal, if approved, will bring online and offline sellers on par as far as GST registration is concerned.