India to scrap ‘Google Tax’ from April 1: What is it? Full details here

The 6% equalization fee, sometimes referred to as the "Google tax," on digital advertising services offered by international tech companies like Google or Meta may soon be eliminated in India. The decision, which is a component of the Finance Bill's recent changes, will take effect on April 1, 2025.

The Google tax was first implemented in 2016 to make sure that international digital service providers that get income from India also pay taxes to the government, even if they do not have a physical location. The goal was to equalize the playing field for international companies using internet platforms and Indian companies subject to local taxes.

But in an effort to reduce trade tensions with the US, which had protested, claiming it discriminated against American companies, these taxes are now being eliminated. The research also claims that Google and Meta increased the cost of digital marketing for Indian businesses by shifting the tax load to marketers.