Placating Trump: Proposal to Remove 6% Google Tax
STORIES, ANALYSES, EXPERT VIEWS
India proposes to remove the 6% equalisation levy imposed on on-line advertisement services offered by companies such as Google and Meta — known widely as the Google tax — from April 1.
The move is likely aimed at placating US President Donald Trump, who has threatened retaliatory tariffs on countries imposing digital taxes on US tech companies from April 2. The provision is included in the 59 amendments to the Finance Bill moved by finance minister in the Parliament last Monday.
The other significant amendment proposes to remove the word “indirectly” in a provision governing offshore funds, to encourage them to relocate to India. Another amendment introduces a new term, “total undisclosed income,” in relation to search and seizure assessment.
This is aimed at clarifying that the intent of a search and seizure proceeding is only to tax undisclosed income. A new sub-clause is proposed to enable the Income Tax Department to make adjustments while processing a return.
