Business

Equalisation levy a ‘sovereign right; not a unilateral measure: FM

Justifying the 2 per cent equalisation levy (EL) imposed by India on the supply of services by multinational enterprises, finance minister Nirmala Sitharaman on Monday said it is a sovereign right to tax revenues earned from operations in the country.

“Equalisation levy is not a unilateral measure… we are not an exception as many countries have done so,” Sitharaman said in a post-Budget conference in Bengaluru.

Companies like Netflix and Facebook get their consumers in a large country like India. “It’s important for the industry to stand up and tell their international sellers that India deserves to tax this,” she said. In October 2021, G20 countries approved a global deal to adopt a 15 per cent minimum corporate tax and reallocate taxing rights for large profitable multinational enterprises (MNEs) to countries where they sell products and services.

Finance Minister Nirmala Sitharaman on Monday pulled up tax boards for allegedly not responding to grievances of the tax assessees and directed their officials to reserve Saturdays to hold meetings with them, as per a PTI report.

(FE, with PTI inputs)




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