US-based hosting provider DigitalOcean has become one of the first companies to start implementing the service tax that was introduced by the government for online games, movies, music and software last month (Hat Tip: Twitter user Raju PP). We have written to AWS, Netflix and Steam asking about their plans to implement the service tax and if the cost will be passed down to the customer. We will update the story when we hear back. DigitalOcean on its part, has started adding the 15% tax to non-business consumer bills from this month, but is offsetting the cost for the first month by crediting the same amount to users. Business entities with a service tax ID can enter it into the service tax ID form on the billing page, which exempts them from paying the service tax. The storage hosting provider mentions that it will pay the tax collected from Indian customers to the relevant tax authorities. My goodness! The service tax crap for online services has started. Digital Ocean leads the way. cc: @2shar pic.twitter.com/CdQmVDA1Qa — Raju (@rajupp) December 7, 2016 India’s new service tax law was implemented from the 1st of December, charging the tax based on the location of the service receiver, as opposed to based on the location of the service provider. As such, companies based outside India now have to pay a 15% service tax for each transaction with a customer based in India, for advertising on the internet, providing cloud services, provisioning books, movies, music,…
