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News INCOME TAX

  • Feb 16, 2021
  • Govt may tweak 2% equalisation levy to provide relief to local traders

    The Central Board of Direct Taxes (CBDT) may tweak the equalisation levy imposed on the sale of goods or services carried out using a non-resident e-commerce operator.

    Currently, a levy of 2 percent is paid by non-resident e-commerce operators on the gross amount of the transaction. However, experts believe the imposition of a levy results in double taxation in cases where the buyer and the seller are both resident Indians but carry out a transaction using a non-resident e-commerce platform like Amazon.

    According to a report by The Economic Times, Kamlesh Varshney CBDT joint secretary has acknowledged that it is a "valid point."

    "(There) may be situations where e-commerce participants are Indians and their gross consideration gets into the consideration of the e-commerce operators... There are issues and the government is not saying that all issues have been handled by the proposal in the Finance Bill,” Varshney had said. He said the issue will be considered at an "appropriate time."