Proposal for Equalisation Levy on Specified Transactions

[Report of the Committee on Taxation of E-Commerce]

Read Also : Salient Features of Equalisation Levy

A Committee on Taxation of e-commerce was constituted by the Central Board of Direct Taxes to examine the business models for e-commerce, identify the direct tax issues in relation to e-commerce transactions and suggest an approach to deal with these issues. The Committee included officers of the Central Board of Direct Taxes, representatives from the industry, the Institute of Chartered Accountants of India and tax experts. The Report of the Committee was received by the Government and taken into consideration in the preparation of Finance Bill, 2016. This Report provides the view of the Committee on issues related to taxation of e-commerce and recent international developments in this area. The Report constitutes followings parts:

  • Section 1: Constitution and Mandate of the Committee
  • Section 2: Digital Economy: Current status and Growth Prospects
  • Section 3: Tax Challenges from Digital Economy & Action 1 in BEPS
  • Section 4: Issues related to Tax Neutrality between Domestic & Multi-National Enterprises and their Implications
  • Section 5: Principles for Allocating Taxing Rights, Factors that contribute to Profitability & Historical Review of Existing Rules
  • Section 6: Broader Tax Challenges related to Nexus and Characterization of Income from Digital Transactions and common Disputes
  • Section 7: Issues related to Value of data & User Activity in Multidimensional Business Models
  • Section 8: Recent International Literature on Taxation of Digital Economy Enterprise
  • Section 9: Options to address broader tax challenges of Digital Economy in the Indian Context
  • Section 10: Characteristics of the Proposed ‘Equalization Levy’
  • Section 11: Conclusions & Recommendations of the Committee
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View or Download the Report of the Committee on Taxation of E-Commerce as under: