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USTR finds India’s digital services levy discriminatory

The US Trade Representative’s (USTR) office has said that the Digital Services Taxes (DST) imposed by India, Italy and Turkey discriminate against American firms and are out of sync with established international tax principles. A sign of relief for India is that the USTR held off potential retaliatory tariffs against the country’s equalisation levy, or the so-called ‘Google tax’. It found that of the 119 companies that are likely liable under the tax regime, 86 or 72% were American companies.

India is not planning to discontinue this levy anytime soon, though it may review the impost once there is a global consensus on such taxation under a G20 framework that is being worked out. India had tried to reassure the US that its equalisation levy was “non-discriminatory”. “The underlying policy objective and application of India’s equalisation levy is to ensure that neutral and equitable taxation is applicable to e-commerce operators that are resident in India or have a physical presence in India and those that are not resident in India,” it had asserted.

 

Comments

  1. Reply

    Italy digital services tax adopted by are discriminatory against the U.S. companies , says U.S. Trade representative on 7 January 2021.
    According to news report , the Trade Representative of the U.S. has claimed in the first week of January 2021 that services tax adopted in recent years by some countries including Italy are discriminatory against the U.S. companies. The news report , however , suggests that the U.S. are not inclined to take any action for now. The statement of the Trade Representative can be interpreted to be suggesting to Italy to bring about some reform suiting the U.S. companies. In this context , it may be apt to refer to this Vedic astrology writer’s one of related predictive alerts in article – “ Reading planetary impacts for Italy in coming year 2021” – published at astralis.it/kumar07.htm on 10 October , 2020 , which reads as follows in the article :-
    “ January-Feb in 2021 look to be presenting major worrisome concerns relating to health. Some issues other countries involving partnership or financial matters may cause concern. Some liabilities or commitments with other countries can be in the center of controversy”.
    These details suggest that the prediction of this writer published as early as last year 2020 on 10 October has been precisely accurate.

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