Tax data transfer between FB group companies: Govindacharya to FM

We are hopeful that you will consider this very important aspect by inserting specific provisions in the upcoming Finance Bill (Budget 2021) to impose tax on data transactions of tech giants in India, with retrospective effect

New Delhi: Amid raging controversy surrounding WhatsApp’s new data privacy policy, former Rashtriya Swayamsevak Sangh (RSS) ideologue KN Govindacharya on Saturday urged Union Finance Minister Nirmala Sitharaman to impose taxes on data transfer between Facebook group companies.

“It is suggested that the best way to regulate internet companies is through adequate taxation,” Govindacharya wrote in the letter reviewed by IANS.

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“We are hopeful that you will consider this very important aspect by inserting specific provisions in the upcoming Finance Bill (Budget 2021) to impose tax on data transactions of tech giants in India, with retrospective effect, as it may help the Government bring in much needed revenue and improve the lives of Indians.”

Facing intense criticism worldwide and now a court case in India, WhatsApp deferred its new data privacy policy announced this month. The Facebook-owned platform delayed the introduction of the policy till May 15.

In his letter to the Finance Minister, Govindacharya, a patron of Rashtriya Swabhimaan Aandolan, said that the government now needs to look at newer sources of taxation and that the “digital sector is one such goldmine, which has been enjoying a laissez faire regime. ”

“With 40 crore users in India, the value of WhatsApp may be around 18 Billion dollars, i.e. around Rs 1,48,000 crore,” Govindacharya claimed in the letter.

He pointed out that France has resumed collecting what is known as its digital-services tax and other countries, including Italy and the U.K., are also set to begin their collection in coming months.

“The Government of India has collected around Rs 4000 crore in the form of “Equalisation Levy”. Therefore, the amount that be recovered from these tech giants in form of Income/Corporate Tax is of huge proportions,” he said in the letter.

“It is submitted that data of millions of Indians is very valuable, and the data transfer between Facebook group companies need to be taxed,” Govindacharya said.