Indian ISPs Taxed for Generating "Light Energy"

CaptKeen writes, "The Hindu is reporting that the Indian Government is trying to tax optical broadband providers (think fiber to the premises) for generating 'light energy.' According to the Commercial Tax Department, optical broadband providers operate on light energy which is 'artificially created and sold to customers for the purpose of data transmission and information.' This classification would make Internet access goods (since you are buying light) as opposed to service — and would be subject to a 12.5% VAT."

Comments

This may be an Indian "April Fools"

[mbone]

as I understand that 10/10 is the equivalent for them.

Re:This may be an Indian "April Fools"

[OmnipotentEntity]

News to me and to wikipedia. http://en.wikipedia.org/wiki/October_10

Tomato

[aralin]

It's like the US government reclassifying tomato as a vegetable so it can impose the import tarif on it. Governments always look for ways how to tax the hell out of you. Nothing new here. Move along.

Re:Tomato

[bdleonard]

That tomato you're thinking of is a fruit

Re:Tomato

[jfengel]

The tomato is botanically a fruit, since it contains the seeds. But fruits are taxed differently from vegetables, and since the tomato is treated more like a vegetable than a fruit in cooking, it took the Supreme Court to decide that this fruit was in fact a vegetable. (Presumably the same applies to squash, which are nearly identical to watermelons botanically; the latter is eaten as a fruit and the former as a vegetable.)

But if we genetically engineer them to put the RSA code on them, then I guess they'd be a munition. They're also good for throwing at bad actors.

India already has service tax !

[alphabetsoup]

I am an Indian and I have no idea what the government is trying to achieve by this. India already has a tax on services, at 12%. How would changing the classification from goods to service help ? The tax revenue will be increasing by just 0.5%.

In any case, this is being done only by a state government, so its valid only within that particular state. It will have no effect on any other parts of the country. And I expect this to be struck down by the courts anyway.

Re:100 phothons please

[stony3k]

Where are my mod points when I need them? The parent poster is absolutely correct. If the Indian tax department goes ahead with this tax, it will stifle the fledgling broadband industry (and in turn IT industry).

However I'm pretty sure this rule was created by some over-zealous bureaucrat and it will eventually get removed. Unfortunately bureaucrats in India (and elsewhere) tend to pretty stupid.