December 25, 2024 07:21 am (IST)
New Delhi, May 31 (IBNS) The equalisation levy, dubbed the 'google tax', introduced by the Union government in the latest Budget, comes into effect from Wednesday, June 1, according to media reports.
The tax is to be paid by Indian businesses for using international digital services.
Indian businesses, from June 1, have to deduct an equalisation levy of six percent for payments exceeding rupees one lakh in aggregate in a financial year to a non-resident service provider for specified digital services.
The areas where the levy will be applicable are online advertising, provision for digital advertising space and other services that may be notified by the government.
The 'google tax' originated during the Base Erosion and Profit Shifting Project (BEPS) discussions, a project spearheaded by the Organisation for Economic Co-operation and Development (OECD), media reported.
According to experts, the project aims to bring G20 countries on a single platform to introduce measures to ensure tax transparency and curb avoidance by multinationals through aggressive tax planning.
If the Indian entity fails to deduct the tax, it will not be allowed to consider these expenses which will increase the entity's tax expenses and liability, according to the rules.
Support Our Journalism
We cannot do without you.. your contribution supports unbiased journalism
IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.
Support objective journalism for a small contribution.
Latest Headlines
How to Choose the Best Marriage Loan for Your Wedding Budget
Tue, Dec 24 2024
Want to Retire Early? Use A Retirement Calculator to See How
Tue, Dec 24 2024
Understanding the Various Types of Demat Accounts in India
Tue, Dec 24 2024
Invest in Sugar Stocks: Start Trading Today
Tue, Dec 24 2024
BEL secures Rs 973 crore orders; FY25 order book reaches Rs 9,801 cr
Mon, Dec 23 2024