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The Google Tax was announced to introduce a tax on the income as accrue to a foreign e-commerce company outside of India.

Any person or entity that makes a payment exceeding Rs.1 lakh in a financial year to a non-resident technology company will need to withhold 6% tax on the gross amount being paid as an equalisation levy or Google tax.

This tax, however, is only applicable when the payment has been made to avail certain B2B services from these technology companies.