techUK signs Multi-Association Letter on Equalisation Levy in India
techUK joins other tech and business trade associations in urging the Indian Parliament to drop the amendment to India’s Equalisation Levy included in the Government of India’s proposed Finance Bill to the Union Budget 2021-22 and instead prioritize India’s continued support for the multilateral negotiations to address the tax challenges arising from the digitalisation of the global economy.
The Union Budget 2020 had included an expansion of scope of India’s existing EL to include a new 2% tax on the sale of all goods and services by non-Indian companies over the internet to Indian residents or persons using an IP address located in India. The proposed changes to the Union Budget 2021-22 could bring significantly more transactions into scope, including transactions for which only one aspect of the transaction takes place online or intragroup transactions. The proposed changes stand to undermine confidence in India’s regulatory environment and negatively impact the ease of doing business in India.
Together with trade bodies from Asia and the Western Hemisphere, we believe that the amendment would create significant challenges for all businesses operating in India, further exacerbating the detrimental impact of a measure at odds with India’s ongoing commitment to the multilateral negotiations at the Organisation for Economic Co-operation and Development (OECD)/G20 Inclusive Framework to address the tax challenges arising from the digitalisation of the global economy.
We also urge the Government of India and the business community invested in India to engage in a robust dialogue to ensure that policies can achieve the Government of India’s intended short-term and long-term objectives, and to include the firms affected by the measure in those discussions.
Read the full letter below.
Multiassociation letter on Equalisation Levy in India.pdfIf you have any questions, please reach out to [email protected].
Daniel Clarke
Dan joined techUK as a Policy Manager for International Policy and Trade in March 2023.
Tess Newton
Tess joined techUK as an Policy and Public Affairs Team Assistant in November of 2024. In this role, she supports areas such as administration, member communications and media content.
Sabina Ciofu
Sabina Ciofu is Associate Director – International, running the International Policy and Trade Programme at techUK.