Facebook CEO and cofounder Mark Zuckerberg has backed France-based organisation for Economic Cooperation and Development (OECD) for their initiative to levy a digital tax on the internet companies.
The matter has been highlighted in the published extracts of Zuckerberg’s speech, which he delivered on February 15 in Germany. In the speech, the Facebook CEO said, “We also want tax reform and I’m glad the OECD is looking at this.”
Zuckerberg added that Facebook wants the OECD process to succeed as it will lead to a stable and reliable system going forward. He also noted that with the OECD decision the company might have to pay more tax at different places under the same framework, but Facebook is willing to do that.
In August 2019, India spoke about digital tax at OECD, following which the French organisation published a proposal for countries to tax highly profitable tech giants.
“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 Gurría.
Moreover, the draft also clarified that any multinational company that has more than 200K users in India will have to pay taxes on the basis of the revenue they generate in India.
As per media reports, the government is looking to tax foreign internet companies that have been leveraging data to push for products and services. Ecommerce companies like Amazon and Alibaba, search engine and social media platforms like Google and Facebook that send target ads, and streaming services like Netflix will be subjected to tax, as per the report. A government official also clarified that “The idea is to have an enabling framework in place so that once the OECD framework is ready, we can go ahead.”
In 2016, the Indian government also imposed a 6% Equalisation Levy, popularly known as Google Tax, on foreign ecommerce companies operating in India.
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