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Centre to Soon Issue Guidelines for Social Media Influencers; Declaring Paid Promotions to be a Must

By: News Desk

News18.com

Last Updated: September 07, 2022, 17:34 IST

Delhi, India

The decision was taken to caution and protect the consumer from any kind of false claims. (Representative image/ Shutterstock)

The decision was taken to caution and protect the consumer from any kind of false claims. (Representative image/ Shutterstock)

It is to be noted here that influencers and other such people who receive free items from companies are already subjected to pay taxes for receiving them

Social media influencers will soon have to declare their brand associations or paid promotions, otherwise, heavy penalties will be charged to them, sources told CNN-News18. The Consumer Affairs Ministry is likely to issue a standard operating procedure (SoP) in the next 10 days to protect online consumers.

The decision was taken with an aim to caution and protect the consumer from any kind of false claims, said sources, adding, “Anyone who is a social media influencer and pushing any particular brand will now have to come clean." The guidelines will help social media influencers to understand the do’s and don’ts as it will become mandatory for them to make disclosures of paid promotions for any brand.

On July 31, traders’ body CAIT called upon the government to bring brand endorsers, social media influencers and bloggers under the proposed framework to protect online consumers from fake reviews of products and services. The Confederation of All India Traders (CAIT) had also argued that rating of a product or service should be made a part of the policy framework for reviews.

The traders’ body had urged the government for an early roll out of a well-defined and robust policy to protect consumers. “In this context, the brand endorsers, social media influencers, bloggers on goods and services should be brought under the ambit of policy on fake and deceptive reviews," CAIT had stated.

Consumer Affairs Secretary Rohit Kumar Singh in May held a virtual meeting with stakeholders to discuss the impact of fake and misleading reviews on online consumers and preparation of a roadmap to prevent such a situation.

It is also to be noted here that influencers and other such people who receive free items from companies are already subjected to pay taxes for receiving them. The guidelines issued by the Income Tax department came into effect on July 1 this year. The Central Board of Direct Taxes in its guidelines issued for these new rules had notified that those who receive benefits will have to pay TDS at the rate of 10 per cent under the new tax rules.

Under the new rule, social media influencers will be liable to pay 10 per cent TDS if they receive a product like a car, mobile, outfit, cosmetics, etc, and retain the same. However, if the product is returned to the company after using the services, it will not fall under Section 194R.

(with inputs from PTI)

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first published:September 07, 2022, 16:21 IST
last updated:September 07, 2022, 17:34 IST
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