The finance ministry has in recent weeks confronted many overseas digital firms drawing significant business income in India, without paying any or due tax in the country, by deftly circumventing the permanent establishment (PE) rule.
The ministry has invoked the principle of source-based taxation under the Income Tax Act, to question the “organisational structures” built by them to avoid paying taxes on the income earned from operations here, official sources said, on condition of anonymity.
Against this backdrop, Dipesh Jain, Partner, Economic Laws Practice (ELP) has been quoted in an article, “Overseas digital firms in a tax fix” authored by Manu Kaushik & Priyansh Verma published in Financial Express (India).
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