Online services provided by foreign website to individuals in India are become taxable under service tax since 1 December 2016.

From 1 December 2016, service tax become applicable on online information and database access or retrieval (OIDAR) services provided online electronically from outside the taxable territory and received in India by Government, local authority, governmental authority or an individual for purposes other than business/profession.

CBEC withdraw service tax exemption on online information & database access or retrieval services by Notification No. 47/2016, Dated: November 09, 2016. The notification comes into effect from 1 December 2016.

By notification No. 46/2016, Dated: November  09,2016 (Place of provision of services (Amendment) Rules, 2016), CBEC amend the Place of Provision of services Rules,2012 related to place of provision of ‘online information and data base access or retrieval services’ with effect from 1 December 2016.

Service Tax (Fourth Amendment) Rules, 2016 (Notification No. 48/2016, Dated: November 9,2016), amends Service Tax rules, 1994 so as to prescribe that the person located in non-taxable territory  providing online information and database access or retrieval services to ‘non- assesse online recipient’ as defined therein, is liable to pay service tax and the procedure for payment of service Tax.

CBEC has issued 46 FAQ’s (Circular No.202/12/2016, Dated : 9^th November 2016)on Service tax on cross border, business to consumer online information and database access or retrieval services.