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Economy
Pradeep Kumar

28/03/21 10:05 AM IST

Digital tax

In news

The United States has proposed retaliatory action against India’s digital services taxation of e-commerce operators that include levying tariffs

Highlights
  • The proposal follows investigations by the United States Trade Representative (USTR) into digital services tax (DST) adopted or under consideration in 10 jurisdictions, including India, Indonesia, the UK, Brazil and the EU, on June 2, 2020.
  • The investigations were initiated under section 301 of the US Trade Act, 1974.
  • In the case of India, the USTR’s proposed course of action includes additional tariffs of up to 25 per cent ad valorem on an aggregate level of trade
  • It would collect duties on goods of India in the range of the amount of DST that India is expected to collect from US companies.
  • Around 40 goods are in the preliminary list of products that would be subject to the additional tariffs.
  • This includes shrimps, basmati rice, cigarette paper, cultured pearls, semi precious stones, silver powder and silver articles of jewelry, gold mixed link necklaces and neck chains and certain furniture of bentwood.
Finance Bill 2020-21
  • The NDA government had moved an amendment in the Finance Bill 2020-21 imposing a 2 per cent digital service tax on trade and services by non-resident e-commerce operators with a turnover of over Rs 2 crore, effectively expanding the scope of equalisation levy that, till last year, only applied to digital advertising services.
  • India based e-commerce operators are already subject to taxes in India for revenue generated from Indian market.
Source: Indian Express

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