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Equalization Levy
As per Equalization Levy bring proposed by a committee of Central Board of Direct Taxes, :

" In other words, what is normally understood as E-Commerce or digital Commerce need not necessarily attract Equalization Levy. Sellers or buyers selling tangible goods by using internet will not be affected, except in respect of payments for specified services. It will also not be levied on services that are not specified, even if such services are procured by making payments from within India over the internet. For example, an Indian resident books hotel rooms abroad. Booking is made and payment is made on the net. However, hospitality services are not specified services for the purpose of Equalization Levy. Hence Equalization Levy will not be levied. Such transactions are normally known as E-Commerce. However, they will not attract Equalization Levy."

"No Equalization Levy will be charged for payments below the threshold limit of Rs. one lakh for a single payment, or Rs. ten lakh of total payments made in a year by a payer to a single party"

"Equalization Levy will not be chargeable on payments for specified services made to Indian Residents. In fact, the levy is proposed to protect Indian residents from unfair competition arising out of unfair tax advantage enjoyed by their foreign competitors"

"A Summary of the Proposed Equalization Levy Charged on Consideration received by a non-resident for specified services, from a resident in India or a permanent establishment in India Provided that Equalization Levy shall not be charged unless -

the consideration received from a person for specified transactions services in a year is more than Rs. 1 lakh Rate 

At a rate that is between 6 to 8 % of the gross amount of consideration for specified transactions

85 Payable by 
The beneficial owner of the consideration for specified transactions Specified Services
 (i) online advertising or any services, rights or use of software for online advertising, including advertising on radio & television; 
(ii) digital advertising space 
(iii) designing, creating, hosting or maintenance of website
(iv) digital space for website, advertising, e-mails, online computing, blogs, online content, online data or any other online facility 
(v) any provision, facility or service for uploading, storing or distribution of digital content 85 In view of the Committee, it may be a preferable option to restrict the rate of Equalization Levy at 6% at the time of its introduction, and then review it in subsequent years, to evaluate the desirability of raising it.
(vi) online collection or processing of data related to online users in India 
(vii) any facility or service for online sale of goods or services or collecting online payments 
(viii) development or maintenance of participative online networks 
(ix) use or right to use or download online music, online movies, online games, online books or online software, without a right to make and distribute any copies thereof 
(x) online news, online search, online maps or global positioning system applications 
(xi) online software applications accessed or downloaded through internet or telecommunication networks 
(xii) online software computing facility of any kind for any purpose 
(xiii) reimbursement of expenses of a nature that are included in any of the above (For the purposes of above, ‘online’ means a facility or service or right or benefit or access that is obtained through the internet or any other form of digital or telecommunication network.) (Equalization Levy would be payable if the sum received is a consideration for any of the above, irrespective of how it may be described in the books of the beneficial owner or the payer) 


Equalization Levy would not be chargeable if the beneficial owner of the consideration for specified transactions - has a permanent establishment in India, and - the consideration forms a business receipt of that permanent establishment, and - the income derived from the sum is attributable to such permanent establishment in India, and taxable under the provisions of the Income-tax Act, 1961, and - the beneficiary makes a declaration in writing in the prescribed form to this effect."

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