07 July 2020 
Andrea Marshall, Tax Specialist
Thanks to Alison Ambrose at Deloittes who has provided a further update regarding the introduction of the 2% "Equalisation Tax" (similar to a Digital Tax) in India.
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Just a quick note to make sure you were aware that on Saturday the Indian government provided a modified payment form (ITNS 285) to enable payment of the Equalisation Levy.
The form requires the Permanent Account Number (‘PAN’) of the non-resident to be provided. Where organisations do not have a PAN they would have to apply for one from the Indian authorities and this process can take two weeks to obtain.
As a reminder, the first instalment of Equalisation Levy is due tomorrow (7 July 2020), where the instalment is deposited late, interest at the rate of 1 % (per month or part of a month) will apply to the amount of levy due.
There is still no detailed guidance (there are rumours that this may be released imminently, but just rumours at this point in time). We are aware that in the absence of any guidance that there is a significant amount of uncertainty about the application of the levy. This may mean considering the impact of making a payment now on the basis of the legislation as it is drafted, versus waiting for greater certainty but potentially incurring interests costs. We are working with organisations to help them to understand which income streams will be subject to the levy, based on the legislation as it is drafted, allowing them to estimate the potential quantum of the levy (and associated interest costs) to help inform this decision.
If you or any of the Universities have any questions or need any assistance please do let me know.
