Context: Recently, the Organisation for Economic Cooperation and Development’s (OECD) proposed new framework estimates having $100 billion a year of additional corporate profits being available for taxation in jurisdictions such as Europe and India.
Issue with taxing the global digital giants:
The recently proposed framework by OECD: based on two pillars:
India’ Stand:
Conclusion: India being an active participant in BEPS, wants the OECD to define a new taxing nexus, significant economic presence, and frame rules to allocate income to that nexus based on gross sales revenue and overall profitability of the enterprise, not just allocate residual profits.