With reference to the Equalisation Levy, consider the following statements:

It was introduced in India in 2016, with the intention of taxing the digital transactions.

It is aimed at taxing business-to-business transactions.

It is a direct tax, which is withheld at the time of payment by the service recipient.

An income chargeable to tax as fees or royalties for technical services will not be included as income for the equalisation levy purposes.

How many of the above statements is/are correct?

Question

It was introduced in India in 2016, with the intention of taxing the digital transactions. Correct: The Equalisation Levy was introduced in India in 2016, with the intention of taxing the digital transactions i.e. the income accruing to foreign e-commerce companies from India.
It is aimed at taxing business-to-business transactions. Correct: It is aimed at taxing business-to-business transactions. It is also often referred to as the "Google Tax"
It is a direct tax, which is withheld at the time of payment by the service recipient. Correct: It is a direct tax, which is withheld at the time of payment by the service recipient.
An income chargeable to tax as fees or royalties for technical services will not be included as income for the equalisation levy purposes. Correct: An income chargeable to tax as fees or royalties for technical services will not be included as income for the equalisation levy purposes.

GKToday Admin · Accepted Answer

All four

It was introduced in India in 2016, with the intention of taxing the digital transactions. Correct: The Equalisation Levy was introduced in India in 2016, with the intention of taxing the digital transactions i.e. the income accruing to foreign e-commerce companies from India.
It is aimed at taxing business-to-business transactions. Correct: It is aimed at taxing business-to-business transactions. It is also often referred to as the "Google Tax"
It is a direct tax, which is withheld at the time of payment by the service recipient. Correct: It is a direct tax, which is withheld at the time of payment by the service recipient.
An income chargeable to tax as fees or royalties for technical services will not be included as income for the equalisation levy purposes. Correct: An income chargeable to tax as fees or royalties for technical services will not be included as income for the equalisation levy purposes.

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