People are always taxed by governments which look to increase its revenue. People curse successive governments for finding new ways to tax them.According to the latest it is coming out that Union Government is getting ready to shock all with Google Tax.
Union Finance Ministry already notified that the the equalisation levy (popularly known as Google tax) introduced in this budget, will come into force from June 1. This tax will apply to the payments for online advertisements made by Indian business entities to non-residents (such as Google, Yahoo, Twitter, Facebook).
The aggregate payment will be taxable where in a financial year to a non-resident exceeds Rs 1 lakh. B2B transactions are liable for google tax.India worked hard to incorporate in the Base Erosion and Profit Shifting action plan amidst stiff opposition from countries like US.
Finance Ministry panel looked into the taxation of e commerce transactions apart from online ads and came with recommendations of wide range of services for tax imposition. They include online content; designing, creating, hosting or maintenance of a website; use or download of online music, movies, games, books et all, online search, online maps or global positioning systems (GPS) applications.
An equalisation levy of 6% will be deducted by business entities in India which makes payments exceeding Rs 1 lakh in the aggregate in a financial year to a non-resident service provider for specified services
