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Cyber Experts: Indian Government Needs to Speed Up Necessary Changes in Domestic Laws on Internet Taxation

India has not yet crystal clearly defined its holistic national approach and perspectives on taxation on the Internet

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Cyber, Experts, Indian
The Indian approach on the Internet taxation has left much to be desired. Pixabay

With the Organisation of Economic Co-operation and Development (OECD) proposing an overhaul in the taxation system for digital companies, cyber experts on Thursday urged the Indian government to speed up necessary changes in domestic laws on internet taxation so that tech giants like Google, Facebook and Amazon can be asked to shell out taxes they have been evading for years.

The OECD on Wednesday published a proposal to advance international negotiations to ensure large and highly profitable multinational enterprises, including digital companies, pay tax wherever they have significant consumer-facing activities and generate their profits.

According to cyber experts, given the fact that India is not yet a part of OECD, it is imperative that India must be mindful of the way how things are evolving.

“The Indian approach on the Internet taxation has left much to be desired. India has not yet crystal clearly defined its holistic national approach and perspectives on taxation on the Internet,” Pavan Duggal, the country’s leading cyber law expert and privacy advocate, told IANS.

Cyber, Experts, Indian
The OECD on Wednesday published a proposal to advance international negotiations to ensure large and highly profitable multinational enterprises, including digital companies. Pixabay

However, it is essential that India is mindful of the global developments that are taking place in this regard and must come up with its own taxation approaches, which are in sync with the global trends that are emerging.

“Further, India needs to distinctly be walking in the path of ensuring that legal entities who are offering their services via the internet in India, whether they are physically present in India or not, would be subject to Indian taxation,” Duggal elaborated.

The new OECD proposal is based on the work of the OECD/G20 Inclusive Framework on base erosion and profit shifting (BEPS), which groups 134 countries and jurisdictions on an equal footing, for multilateral negotiation of international tax rules, making them fit for purpose for the global economy of the 21st century.

“We’re making real progress to address the tax challenges arising from digitalisation of the economy, and to continue advancing toward a consensus-based solution to overhaul the rules-based international tax system by 2020,” said OECD Secretary-General Angel Gurria.

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According to advocate Virag Gupta, in the K.N. Govindacharya petition before Delhi High Court in 2012, taxation of Internet companies was first raised when the government of India gave “Double Tax Avoidance Agreement: as reason to not tax foreign Internet companies.

The OECD proposal “may strengthen the case for taxation where these companies are having huge business or presence. But how can tax haven countries can be compelled to follow the OECD guidelines?” Gupta told IANS.

Countries like China, France and Germany have shown political will-power to tax Internet companies but India has miserably failed to tax Internet giants despite being the biggest market.

“India’s Parliament is supreme and sovereign to tax these companies for which necessary amendments are to be made in the Income Tax Act, Companies Act and Information Technology (IT) Act etc,” he suggested.

Cyber, Experts, Indian
According to cyber experts, given the fact that India is not yet a part of OECD, it is imperative that India must be mindful of the way how things are evolving. Pixabay

According to him, India was always free to tax these companies.

“In this current economic slowdown, OECD decision may enable government to bring new tax regime by which digital companies may be taxed,” Gupta added.

At the moment, the said OECD “Public Consultation Document” is only indicative of the consultation process wherein stakeholders have been asked to give their comments by November 12, 2019.

However, the approach could form the basis for subsequent evolution of jurisprudence concerning taxation in the context of the Internet.

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“The fact remains is that today, most of the companies offering services on the Internet are not paying their share of taxation in different jurisdiction. This is despite them taking the benefit and advantage of the markets of the said jurisdictions,” informed Duggal.

“Further, India needs to distinctly be walking in the path of ensuring that legal entities who are offering their services via the internet in India, whether they are physically present in India or not, would be subject to Indian taxation,” added Duggal, who is also a senior Supreme Court advocate.

There are immense amount of challenges in this regard.

New changes would be required in the existing Income Tax laws but more significantly as a nation, “we need to make up our mind as to in what manner, we want to contribute to the evolving taxation jurisprudence on the Internet”, Duggal emphasized.

“The top 15 Internet companies alone have amassed a value of over Rs 20 lakh crore due to their Indian users. The companies’ value could be a major chunk of the Indian economy but is serving no purpose to Indians,” informed Gupta. (IANS)

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The Best Destinations for a Perfect Travel Experience

Here are some offbeat Indian destinations for backpackers

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Travel destinations
For millennials, travel is not just a means of escaping a busy lifestyle, but an end in itself. Pixabay

Millennials are seekers of wholesome experiences. For them, travel is not just a means of escaping a busy lifestyle, but an end in itself. It’s an essential part of life, not a break away from it.

In sync with the new taste and preferences of young adventure-seekers, the following places are rising up to the occasion by enhancing their travel experiences:

Wayanad- travel
Wayanad is the perfect travel destination for nature-lovers. Pixabay

Aurangabad
An exquisite confluence of history and culture, Aurangabad is home to the renowned Ajanta and Ellora Caves, a lot of old forts, art galleries, and museums. Besides this, the place is a bubbling, simmering pot of a range of dishes that no food-lover can afford to miss.

Mukteshwar
What could be better than mountains and peace? Mukteshwar is the stuff that a nature lover’s dreams are made of. It is the perfect place to chill alongside Nature within the folds of mighty mountains while enjoying the soul-soothing embrace of sunlight and the skin-tingling kiss of wintry waft. Mukteshwar is less than an eight-hour drive from Delhi, making it one of the closest hill stations to the Capital.

Wayanad
Wayanad is another treat for nature-lovers who also seek unique cultural experiences. Situated at a distance of 76 kilometers from the beaches of Kozhikode, the region is popular among backpackers on account of its near-perfect weather and scenic setting punctuated with dams, lakes, and hike trails. The town paints a quaint and soothing picture with the lush green of mountainous plateaus, picturesque jungles, and idyllic valleys dominating. Squatting atop the Western Ghats and enclosing part of the Nilgiri Biosphere Reserve, Wayanad is not considered the most beautiful district in Kerala in vain.

Alleppey- travel
Alleppey is a famous travel destination known for its backwaters and houseboats. Pixabay

Pokhara
Pokhara is often called the tourism capital of Nepal – and it is not in vain that it has received this moniker. It serves as a gateway to the renowned Annapurna Circuit, is among the most exciting paragliding destinations the world over, and offers the entrancing sight of the beautiful lake framed by sky-piercing mountains. What crystallizes its reputation as the ultimate ‘Adventure Land of Nepal’ is that it cuts a less busy version of Kathmandu while holding on its own as a must-visit backpacker’s paradise.

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Alleppey
It is only when one has explored the intricate network of waterways which can only have been knitted by Mother Chaos that one realizes that the tag ‘Venice of the East’ does Alleppey injustice. Perpetually carrying the fascinating look of a forest having just emerged from a spell of rain, the region is famous for its toddy shops, punted boats, coir industry, paddy fields, the floating villages, and houseboats! (IANS)