The taxation of the digital economy is in the forefront of global tax issues. While the OECD concluded on some tax aspects of the digital economy in the BEPS project (e.g. intangibles, certain PEs), a global solution to the challenges posed by the digital transactions is missing. Many countries are working on national solutions. Furthermore, the EU Commission recently suggested alternative solutions on a short-term basis. India, in particular, has much focussed on the topic in court cases and established the “equalisation levy" in 2016, to capture online advertising revenue. While Indian authorities and courts have dealt with the taxation of E-commerce activities and the like under the PE rules, the recent Tribunal decision on Google India (October 2017) concluded that payments should be considered as royalties.
