20 int’l tech companies registered under digital service tax

Kathmandu: The foreign tech companies such as Apple, Google, Microsoft, Meta, X (former Twitter) and Netflix, which have been providing electronic services to Nepalis, began paying digital service tax (DST) in Nepal.

Chief tax officer and information officer at Big Taxpayers Office, Dhruba Prasad Pande, informed that 20 foreign IT companies began paying two percent DST of their digital transaction in Nepal. The Financial Act, 2079/20 introduced the DST in Nepal.

However, all tech companies providing digital services in Nepal have not come under DST for two years since the launch of the tax system.

The Office has further informed that those registered as big taxpayers are Google Asia Pacific Pvt Ltd, Google Ireland Ltd, Google Digital Ink, LinkedIn Singapore Pvt Ltd, NCS Pearson Incorporation Ltd, Amazon.com service, LLC and Amazon Wave Service Incorporation Ltd, EBSCO International Incorporates, Meta Platform Ireland Ltd, Microsoft Regional Sales Pvt Ltd, Adobe System Software Ireland Ltd, Netflix Pvt Ltd, Joho Corporation Pvt Ltd, Prometric Japan Company Ltd, ACCA, Pearson Education Ltd, Apple Distribution International Ltd and Apple Service Pvt Ltd.

TikTok which got its 9-month ban lifted recently is paying the DST. Google Asia Pacific Pvt Ltd, the mother company of the world’s largest search engine has been registered in Nepal, while other popular social networks such as Meta (Facebook, WhatApps and Insta), TikTok and LinkedIn have also been registered.

With the registration of such internal tech companies, it is believed that Nepal would be able to generate revenue hugely. However, there are many other such companies out of registration in Nepal.

Although the current Financial Act has provisioned these companies to submit two percent service tax out of total transactions, the Act is not clear how the tech companies out of big taxpayer’s schemes could be imposed tax.

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