‘Centre won’t extend deadline for levy on foreign e-com firms’

Government comment:

- The government is not considering extending the deadline for payment of Equalisation Levy by non-resident e-commerce players.

- A majority of them are yet to deposit the first instalment of the tax.

- Asserted that the entities liable to pay the levy had ample time to apply for PAN and prepare themselves for the levy.

About equalisation levy:

- The 2% equalisation levy was introduced in the 2020-21 Budget and came into effect from April 1.

- The deadline for payment of the first instalment for April-June is July 7.

- The tax would be levied on consideration received by e-commerce operators from online supply of goods or services.

- The tax applies on e-commerce transactions on websites such as Amazon.com.

- Google in particular has been worried as the tax applies on advertising revenue earned overseas if those ads target customers in India.

- Late-payment would attract interest at the rate of 1% per month or part of the month.

- Non-payment could result in a penalty equal to the amount of equalisation levy, along with interest.

- It is a direct tax.

- Equalisation levy at 6% has been in force since 2016 on payment exceeding Rs 1 lakh a year to a non-resident service provider for online advertisements.

- It is now applicable for e-commerce companies that are sourcing revenue from Indian customers without having tangible presence here in the country.

Reference: https://www.thehindu.com/business/Industry/centre-wont-extend-deadline-for-levy-on-foreign-e-com-firms/article32015712.ece#:~:text=The%20government%20is%20not%20considering,the%20tax%2C%20an%20official%20said.&text=There%20would%20be%20no%20extension,payment%2C%E2%80%9D%20the%20official%20added.