India is looking to tax global streaming giant Netflix‘s income in the country, a first for an international digital consumer company.
What Happened? The Income Tax department is gunning for a slice of the streaming service’s income in India, Economic Times reported, citing sources. The government agency pegged income from the firm’s permanent establishment in India at ₹55 crore in the assessment year 2021-22.
Tax officials argue that the US-headquartered firm is liable to pay taxes in the country because it has some infrastructure and employees on secondment from its parent entity working in India, the report said.
Netflix is estimated to have more than 6 million subscribers in the country and likely earned a gross revenue of ₹1,529.36 crore in the financial year 2021.
The global streaming giant faces stiff competition in India from the likes of Disney+ HotStar, Amazon Prime, and Sony Liv. Even Mukesh Ambani’s Jio Cinema has emerged as a top player in the streaming market in India after acquiring rights to stream the IPL and bagging rights for HBO content in India. Netflix has banked on cuts to subscription fees in the country to attract price-sensitive Indian consumers.
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However, the streaming race in the country is heating up as more competitors join the fray. Market leader Disney+ Hotstar reportedly lost nearly 84 lakh subscribers in the past six months.
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