Brooks - A Payroll Specialist, Since 1999

The government is likely to expand the scope of the equalisation levy, the so-called “Google tax”, to bring more digital transactions into the tax net in the upcoming budget to curb tax avoidance by multinational chartered accountant firms in mumbai . Online sales of goods and services; downloading of software, songs, movies and books; and online consumption of news are among the services that the government may consider for the levy. “Internationally the trend is to bring more digital transactions into the tax net as multinational companies end up avoiding taxes. It was just a beginning last year when we introduced a six per cent tax on online advertisement,” said an official. The government has imposed a six per cent levy for business-to-business transactions on income accruing to foreign e-commerce companies from India for specified services like online advertisement. It has been imposed on non-resident companies without a permanent establishment for incomes...

Where assessee-company made payment of royalty to its AE for mere use of trademark, that too by means of non-exclusive licence, it was to be allowed as revenue expenditure while determining ALP. Assessee-company (GKN Driveline (India) Ltd.) was engaged in business of manufacture and sale of Constant Velocity Joints (CVJ) – During relevant year, assessee made payment of royalty to AE for use of its trademark in respect of manufactured products – In transfer pricing proceedings, TPO taking a view that payment in question was capital in nature, disallowed same and made certain addition to assessee’s ALP – It was noted that Tribunal in assessee’s own case relating to earlier assessment year, opined that assessee did not acquire any ownership right in trademarks by paying amount of royalty – It was further noticed that royalty was paid simply for use of trademarks, and that too tax consultancy firms in delhi , by means of a non-exclusive license – Tribunal had thus conclude...