Finance Bill 2025: To keep America happy, the Modi government has prepared to amend Finance Bill 2025. The Government of India is going to remove Google tax from global companies earning from digital advertising from 1 April. Due to reduced tax burden, companies like Google and Meta have got great relief. The biggest news in this amendment is that 6% Ecqualization Levi has been removed. This will directly benefit these companies. So let’s understand why this amendment is, why it is so important, and what will benefit these digital companies.
What is equivalent levy?
The equivalent fee was a type of tax implemented by the Government of India in 2016. This tax was levied on foreign digital companies. Which offers Indian users digital services (eg advertising, online shopping, cloud services). Its main objective was to impose tax on these companies in the same way as taxes are levied on Indian companies.
6 percent equivalent fee was levied on foreign companies that were earning money from Indian advertisers through digital advertisements on Google, Meta and Amazon. This 6 percent tax was levied on those companies. This law was imposed to bring these companies under the Indian tax system to levy taxes on them in India.
What will be the benefit of companies?
After this amendment, now these companies will have to pay less tax on income from their digital services in India. This will reduce their overall bill and they will be able to use a large part of their income for their investment or development.
• Tax cuts will give these companies an opportunity to further expand their Indian operations. They can now bring more flexibility to pricing their services. Apart from this, he can strengthen his hold in the Indian market.
• Earlier, foreign companies suffered some losses due to equalization fee. Local companies benefited from competition. Now since the taxes have been reduced, foreign companies will be able to offer their services better. This can be a major change for the Indian digital market.
• Investment of these companies may increase in the Indian market. This can lead to more investment and development in digital advertising, e-commerce and other sectors, which will also benefit the Indian economy.
