The 6% equalization levy, a tax which covers international hosting, online advertising and other online services, come into effect today. Dubbed the 'Google Tax', the levy aims to indirectly tax international internet companies such as Google and Facebook, and even hosting, email service by adding a levy on payments made to them for advertising. As such, an additional tax of 6% will be applicable on all international online purchases of advertising hosting, apps, software that costs more than Rs 1 lakh. Many startups have raised concerns regarding the implementation of the levy and that it is premature to enforce the same. They also said that the costs of the levy will be passed on to customers instead. More on that here. The government wants to expand the scope of the equalization levy In its recommendations, almost every conceivable online service is sought be brought under the equalization levy: 1. Designing, creating, hosting or maintenance of website. 2. Any service which involves sale of goods or services or collecting online payments 3. Online advertising or any services, rights or use of software for online advertising, as well as advertising on radio and TV 4. Use or right to use or download online music, online movies, online games, online books or online software. 5. online news, online search, online maps or global positioning system applications. 6. software applications accessed or downloaded through internet or telecommunication networks. 7. software computing facility of any kind for any purpose. 8. online collection or processing of data related to online users in India. 9. any provision, facility or service for uploading,…
