Bangalore : As announced by Google Adwords by email, Google Adwords will start taking service tax on or after 1st October, 2014 after Government of India removed “Sale on online advertisement space” from negative list category.
Now, Google Adwords will charge 12.36% (inclusive of Education Cess and Secondary & Higher Education Cess) to all advertisers from India.
Below is snippet of email sent by Google Adwords today to all Advertisers in India who have account in Google Adwords.
Bing also had sent similar email few days back. Here is snippet.
Many website owners are confused about paying service tax when selling Online Advertisement Space was removed from negative list category but as per my opinion, its clear that Google Adwords will charge service tax and pay to Government while website owners will be counted as intermediate but we have to confirm it with tax experts before this. We are consulting with more tax experts on this and update you here with more details.
Note : If you are directly dealing with Advertisers then in that case, you have to pay service tax for revenue income by direct Advertisers.