{"id":4050,"date":"2016-06-03T12:06:47","date_gmt":"2016-06-03T06:36:47","guid":{"rendered":"http:\/\/www.ishwark6.sg-host.com\/?p=4050"},"modified":"2016-06-03T17:18:15","modified_gmt":"2016-06-03T11:48:15","slug":"google-tax-impact-startups","status":"publish","type":"post","link":"https:\/\/startup-buzz.com\/?p=4050","title":{"rendered":"What is \u2018Google tax\u2019 and how does it impact startups?"},"content":{"rendered":"<blockquote class=\"modern-quote full\">\n<p style=\"text-align: center;\"><strong>Google tax- Good or bad?<\/strong><\/p>\n<\/blockquote>\n<p>Few new rules have been formed. Paying \u2018Google tax\u2019 is one of the new rules that came in to effect from June 1. Google tax refers to Indian startups that are highly dependent on online platforms like Google, Facebook, Twitter and LinkedIn for their business. \u00a0Indian advertisers will have to withhold 6% tax and deposit it with the Government, which in simple terms is known as \u2018Equalisation Levy\u2019. It will be imposed on transaction of more than 1 lakh. Equalisation Levy is dubbed as \u2018Google tax\u2019. \u00a0In case, the Indian advertisers fail to collect 6% tax, it will be calculated as a taxable profit of the Indian company.<\/p>\n<p>This step is taken to directly tax the global Internet firms, the likes of Google (Alphabet Inc), Yahoo, Facebook and so on that mints money from Indian advertisers but don\u2019t fall under the purview of taxation. The government has faced difficulties in bringing them under the tax net because, even where payment for services may take place in Indian currency, the payments is smartly made in tax-friendly locations outside the jurisdiction of Indian authorities. Products and services can range from online advertisements or online advertising space to design, creation, hosting or maintenance of websites etc.<\/p>\n<p>\u2018Google tax\u2019 is accompanied by other reforms and budgetary proposals announced by Finance Minister Arun Jaitley in his budget statement including the 0.5 % agricultural cess, 1% luxury tax and a compliance window for black money holders.<\/p>\n<p>In such a situation, it becomes difficult for start-ups to pay tax and survive financially. This tax is discouraging to startups, especially tech-based startups which is totally contradictory to what the government is trying to do through its initiative \u201cStartup India, Standup India\u201d. \u00a0However, to cover up the tax, giants like Google and Amazon are likely to increase the price of their products and services. With this, the startups are not benefiting anything.<\/p>\n<p><strong>Takeaways:<\/strong><\/p>\n<ul>\n<li><strong>Google tax refers to Indian startups that are highly dependent on online platforms like Google, Facebook, Twitter and LinkedIn for their business, which came into effect from June 1. <\/strong><\/li>\n<li><strong>Indian advertisers will have to withhold 6% tax and deposit it with the Government, which in simple terms is known as \u2018Equalisation Levy\u2019.<\/strong><\/li>\n<li><strong>This step is taken to directly tax the global Internet firms, the likes of Google (Alphabet Inc), Yahoo, Facebook and so on that mints money from Indian advertisers but don\u2019t fall under the purview of taxation.<\/strong><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Google tax- Good or bad? Few new rules have been formed. Paying \u2018Google tax\u2019 is one of the new rules that came in to effect from June 1. Google tax refers to Indian startups that are highly dependent on online platforms like Google, Facebook, Twitter and LinkedIn for their business.<\/p>\n","protected":false},"author":22,"featured_media":4074,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[27,21],"tags":[1022,1021,70,875],"class_list":["post-4050","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-start-up","tag-equalisaton-levy","tag-google-tax","tag-startup","tag-startup-buzz"],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/startup-buzz.com\/wp-content\/uploads\/2016\/06\/what-is_1.jpg","_links":{"self":[{"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/posts\/4050","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/users\/22"}],"replies":[{"embeddable":true,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4050"}],"version-history":[{"count":5,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/posts\/4050\/revisions"}],"predecessor-version":[{"id":4077,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/posts\/4050\/revisions\/4077"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=\/wp\/v2\/media\/4074"}],"wp:attachment":[{"href":"https:\/\/startup-buzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4050"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4050"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/startup-buzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4050"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}