'Google tax' to be levied from June 1; here's all you need to know about it
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The ‘Google Tax’ or ‘Facebook Tax’ which was first announced in the FY17 budget statement by Finance Minister Arun Jaitley will be levied from June 1. Here’s all you need to know about it – what Google Tax is, who will pay it, and its implications -
As the name suggests, it’s got something to do with e-commerce companies.
The Google Tax was announced to introduce a tax on the income as accrue to a foreign e-commerce company outside of India. Google Tax or ‘equalisation levy’ as it’s called in India, is expected to impact the bottomlines of giants like Google, Facebook, and others.
So what is this Google Tax (or Amazon or Facebook Tax)?
According to the Budget announcement, any person or entity that makes a payment exceeding Rs 1 lakh in a financial year to a non-resident technology company will now need to withhold 6% tax on the gross amount being paid as an equalisation levy. The said rule is applicable when the payment is made to companies that don’t have a permanent establishment in India. This tax, however, is only applicable when the payment has been made to avail certain B2B services from these technology companies.
What are the services that fall under this rule?
Specified services include online and digital advertising or any other services for using the digital advertising space. This list, however, may be expanded soon.
Why has the tax been introduced?
The tax has been aimed at technology companies that make money via online advertisements. Their revenue is mostly routed to a tax haven country. This tax will help bring the said companies under the tax radar in India. With this new tax, India has also joined the list of other Organisation for Economic Cooperation and Development (OECD) and European countries where a similar tax is already in place.
Who will it impact?
If you’re a business owner, especially running a small business or an online start up, and you use Facebook or Google for advertising and marketing promotions, then the Google Tax will impact you.
Let’s take an example: assume that A runs a company and is liable to pay Rs 5 lakh to a foreign company to advertise with them.
With the new tax in place, A will have to withhold 6% of the amount – i.e. Rs 30,000 – and pay the balance Rs 4.7 lakh to the foreign company for its services. The withheld amount will be paid to the government.
It remains to be seen whether the foreign company will stand to bear the loss by simply accepting lower margins because of the new tax or will they hike the advertising rate taking the new tax into account?
If the latter happens, which is most likely, the Indian business owner, in this case, A, will bear the loss.
A’s overall billing will likely shoot up by about 6%, which means he will have to pay Rs 5 lakh plus taxes. So his total payout may go up to Rs 5.3 lakh.
What if an Indian business owner or company fails to deduct this tax?
The Budget has proposed that any Indian business owner or company that fails to deduct this tax or equalisation levy or doesn’t deposit it with the government, then the company will not be allowed to consider the expenses in calculating taxable profits. This will increase the taxable income, thereby hiking the company’s tax liability.
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@superwoman wrote:
good tax – good days – my country is progressing
But why they call it @GoogleCA TAX ?
google is part of alphabet and a pvt. Co. Outside India, what the hell India Govt. Revenue structure has to dedicated google tax., tommorw they will pose Sunny Leone Tax or Trump tax or Mallya Tax., ?
@B@R_0_0_D wrote:
@superwoman wrote:
good tax – good days – my country is progressing
But why they call it @GoogleCA TAX ?
google is part of alphabet and a pvt. Co. Outside India, what the hell India Govt. Revenue structure has to dedicated google tax., tommorw they will pose Sunny Leone Tax or Trump tax or Mallya Tax., ?
Mallya Tax 😂😂😂
@GoogleCA CLEAR WHAT WILL BE YOUR NEXT STRATEGY 😂😂
@sukhichd710 wrote:
@GoogleCA CLEAR WHAT WILL BE YOUR NEXT STRATEGY 😂😂
Changing Id 😁
@B@R_0_0_D wrote:
SunnyTax will start from Shaniwar
First it will be imposed on UDTA PUNJAB
and biggest tax payer by the end of year will be Baba honey Singh @baadshah @badshah
The number of taxes are increasing in every budgets. And then we get quotes from our ministers," Nobody is forcing you to take a service but if you take it then you will have to pay taxes for it."
@B@R_0_0_D wrote:
SunnyTax will start from Shaniwar
First it will be imposed on UDTA PUNJAB
and biggest tax payer by the end of year will be Baba honey Singh @baadshah @badshah
The number of taxes are increasing in every budgets. And then we get quotes from our ministers," Nobody is forcing you to take a service but if you take it then you will have to pay taxes for it."
Very bad news for website/blog/forum owners, local businesses will pay to google for advertisements >> high cost or same cost >> however actual advertisement earnings for bloggers/website owners will decrease.
Who will bear the loss ???
Businesses advertising online >> A big no.
Google >> No
People dependent on advertisement revenues (bloggers/website owners) >> Yes as google would lower the CTC or pay per click 
Indian government, don’t you dare to even understand the impact on online websites/startups dependent solely on online advertisements, bus yu hi kehta ho StartUp India 
@admin Any inputs regarding the topic ??? you are operating DD as big as ocean 
एक कहानी
एक 80 वर्षीय बुजुर्ग के हृदय का ऑपरेशन हुआ ।
बिल आया 8 लाख रुपया, बिल देखने के बाद बुजुर्ग की आँखों में आंसू आ गए , यह देखकर डॉक्टर ने कहाँ रोइये मत में इसे कम कर देता हूँ।
बुजुर्ग ने कहा यह बिल तो बहुत कम है, अगर 10 लाख भी होता तो में देने में समर्थ हूँ। आँसू तो इस लिए आये कि जिस प्रभु ने 80 वर्ष तक इस दिल को सम्भाला, उसने कोई बिल नही भेजा आपने केवल तीन घण्टा सम्भाला, 8 लाख रूपये।
वाह रे मेरे प्रभु …आप कितना ध्यान रखते है हमारा।🙏
@sukhichd710 wrote:
@GoogleCA CLEAR WHAT WILL BE YOUR NEXT STRATEGY 😂😂
Grossing Up
@GoogleCA wrote:
@sukhichd710 wrote:
@GoogleCA CLEAR WHAT WILL BE YOUR NEXT STRATEGY 😂😂
Grossing Up
Bhagwan apke calci ka calcium banaye rakhe ?
From tomorrow there is another tax we are going to pay, i.e. Krishi Kalyan Tax, Total tax will be 15% now.
I am now really hating this Govt, Whats for us ? Its fine you want to help the poor people but why by killing Rich/Average ppl.
Go after the Black Money, Go after the Corrupted ppl, If you want to help poor help them by other way, why from our Money
I will go for NOTA this time.
@B@R_0_0_D wrote:
@GoogleCA wrote:
@sukhichd710 wrote:
@GoogleCA CLEAR WHAT WILL BE YOUR NEXT STRATEGY 😂😂
Grossing Up
Bhagwan apke calci ka calcium banaye rakhe ?
I don’t have to care. People paying me have to care
@Beinghuman wrote:
From tomorrow there is another tax we are going to pay, i.e. Krishi Kalyan Tax, Total tax will be 15% now.
I am now really hating this Govt, Whats for us ? Its fine you want to help the poor people but why by killing Rich/Average ppl.
Go after the Black Money, Go after the Corrupted ppl, If you want to help poor help them by other way, why from our Money
I will go for NOTA this time.
Go after Corrupt people
Khud hi corrupt hain 
I still remember after BJP came, they abolished old scheme of student loan subsidy, i was shocked after their move, my father asked bank manager he simply replied no subsidy is provided now, i googled then and found HRD ministry, decision of stopping this scheme… http://www.telegraphindia.com/1150124/jsp/front...
http://www.indianvoice.org/strongly-oppose-hrd-...
There are many such policies against medium class households, they are increasing taxation, same medical facilities, wahi purani education facilities,……………..
dis is wat happens to the country wen illiterate people r made ministers.By bringing this kind of tax foriegn company like google will obviously add tax to da amt(5 lakh + 30000) it’ll b loss for da indians and not for da foriegn company.
Kitne tax lege ye
@Beinghuman wrote:
From tomorrow there is another tax we are going to pay, i.e. Krishi Kalyan Tax, Total tax will be 15% now.
I am now really hating this Govt, Whats for us ? Its fine you want to help the poor people but why by killing Rich/Average ppl.
Go after the Black Money, Go after the Corrupted ppl, If you want to help poor help them by other way, why from our Money
I will go for NOTA this time.
what if congress was in power????
so is MODI the great India friendly or he is funding his foreign tours from all the taxes and abolishing the subsidies
@Beinghuman wrote:
From tomorrow there is another tax we are going to pay, i.e. Krishi Kalyan Tax, Total tax will be 15% now.
I am now really hating this Govt, Whats for us ? Its fine you want to help the poor people but why by killing Rich/Average ppl.
Go after the Black Money, Go after the Corrupted ppl, If you want to help poor help them by other way, why from our Money
I will go for NOTA this time.
Be it this govt be it that govt
The foundation of this was laid by reverred Manmohan Singh finance minister in 1994.
Mr P chidambaram enhanced purview of service tax in 2000 era by changing inclusive list to exclusive list.
It’s an indirect tax & from the day it was launched it was sure it will converge with other indirect tax rates like excise etc
That’s why all governments keep rising it phases wise. 12 to 14 to 15 & finally 16/18 where max rate of GST will lie.
We as taxpayers have no respite.
This was bound to happen.
good tax – good days – my country is progressing
