[Manasvin Andra is a 4th year B.A., LL.B. (Hons.) student at NALSAR University, Hyderabad] Promotional offers have long been used by companies to draw attention to their products. These strategies have generally proved successful, as they incentivise consumers to buy more of the designated good. However, the tax treatment of these free supplies changed with the emergence of the GST, leading to...
Input Tax Credit under GST: The Misery of Innocent Buyers
[Yash More and Hitoishi Sarkar are II year students at Gujarat National Law University] In 2017, the Indian Parliament introduced the concept of Goods and Services Tax (“GST“). Designed to be a single, comprehensive, destination-based taxation system, it aimed to overhaul the existing indirect tax framework and unify the country in terms of how taxes are collected. An uninterrupted...
India’s Equalisation Levy, Digital Services Trade, and the Evolutionary Approach – Part II
[Ayushi Singh is a 5th year student at National Law University, Jodhpur] As mentioned in the previous post, USA could challenge the equalisation levy and similar digital services taxes for violation of the most favoured nation [MFN] treatment under article I of the General Agreement on Trade in Services [GATS]. Before unpacking the possible arguments for an MFN action, some unique ambiguities...
India’s Equalisation Levy, Digital Services Trade, and the Evolutionary Approach – Part I
[Ayushi Singh is a 5th year student at National Law University, Jodhpur] Multilateral trade relations have suffered numerous blows from proponents of unilateral protectionism in the form of trade wars and economic warfare. The issue of digital taxation has the potential of becoming an additional blow. The United States Trade Representative [USTR] has announced the initiation of investigations...
Permanent Establishments: A note on DIT v. Samsung Heavy Industries
[Pragya Kaushik was a Law Clerk-cum-Research Assistant to Hon’ble Justice Rohinton Fali Nariman in 2019-20 and is a graduate from National Law School of India University, Bangalore] The determination of Indian tax liability of a foreign enterprise is a deeply contentious topic plaguing the Indian tax law regime. It involves a lot of complicated issues, one of them being the determination of...
Equalisation Levy in India: The Impediments of Extra-Territoriality
[Vedangini Bisht and Shubham Chaudhary are third year students at National Law University, Delhi] India recently passed its Finance Act 2020 to expand the scope of equalisation levy, a type of digital service tax, charged to non-residential e-commerce businesses. However, the Act (passed on March 27, 2020) has extra-territorial application, since it attempts to tax the income earned from...
GST Implication on Director’s Remuneration: CBIC’s Circular
[Ashutosh Choudhary (BA.LLB) and Anuj Jain (BBA.LLB) are 3rd year students at National Law University Odisha] The issue of applicability of Goods and Services Tax (“GST”) on the remuneration of directors has prevailed since the very inception of the legislation. The bone of contention that needs to be settled is whether the remuneration paid to directors by companies falls within the ambit of...
Tax Avoidance under India-Mauritius Treaty: Shift towards a More Contextual Approach?
[Rajarshi Singh and Rakesh Sahu are penultimate year BA.LLB students at National University of Study and Research in Law, Ranchi] The Authority for Advance Ruling, New Delhi (AAR), in its order dated 26 March 2020 in Re Tiger Global International II Holdings, Mauritius denied the benefits claimed by the applicants under the India-Mauritius Double Tax Avoidance Agreement (DTAA) on the ground that...
Tax Implications of the COVID-19 Response: Corporate Residency and POEM
[Manjri Singh and Vijayaditya Reddy are IV year students at NALSAR University of Law] The public health emergency caused by the corona virus pandemic has plunged the world into uncertain times. In order to ensure continuation of business in such an environment, video conferencing and other remote options are the only possibilities for conducting corporate meetings. For example, the Ministry of...
India’s Equalisation Levy: Perspectives and Tax Positions
[Hardeep Singh Chawla is an Advocate with an LL.M. in International Taxation from NYU School of Law. He may be reached at [email protected]] Much has been written about the expanded scope of the equalisation levy (“Levy” or “2020 Levy”) (see here and here) under the Finance Act, 2020. At a simplistic level, this Levy is introduced to capture into the tax net transactions that escaped...
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