Equalisation Levy: Taxing the Digital Economy

Recently, Google India paid more than six hundred crore equalization levy in FY20.

About Equalization Levy

  • Also Known as Google Tax or Digital Tax, it was introduced in India in 2016, with the intention of taxing the digital transactions i.e. the income accruing to foreign e-commerce companies from India.
  • It was charged at 6% on certain online advertising and related services. The Finance Act 2020 amended the Finance Act 2016, introducing a new Equalisation Levy at 2% on the consideration received/receivable by an e-commerce operator from the following transactions (e-commerce supply or services):
  1. Online sale of goods owned by the e-commerce ....
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