Signing a pact for the transition from equalisation levy, India and the US on Wednesday agreed for a transitional approach on equalisation levy or digital tax on e-commerce supplies beginning April 1, the Finance Ministry said on Wednesday, November 24. “India and the United States have agreed to the same terms … shall apply between the United States and India with respect to India’s charge of 2 per cent equalisation levy on e-commerce supply of services and the United States’ trade action regarding the said Equalisation Levy. However, the interim period that will be applicable will be from April 1, 2022, till implementation of Pillar One or March 31, 2024, whichever is earlier,” the Ministry said in a statement. “This compromise represents a pragmatic solution that helps ensure that countries can focus their collective efforts on the successful implementation of the OECD/G20 Inclusive Framework’s historic agreement on a new multilateral tax regime and allows for the termination of trade measures adopted in response to the Indian equalization levy,” the US government said in its statement.