China feels the heat as India tightens the Screw on tax evasion by Chinese Companies
So much so that the Chinese Communists have even expressed concern over the business environment in India as Indian authorities have begun strict tax audits, to provide a fair, transparent and non-discriminatory environment for Indian enterprises in the same field.
Gao Feng, A spokesperson of Ministry of Commerce made a indirect comment on the above tax probes during a routine press conference in Beijing, clearly indicating their own nervousness.
The Chinese have gone on to even claim that China has contributed to Indian economic development, and created a large number of local jobs, and therefore India Should provide free environment for Chinese businesses.
India’s Ministry of Finance issued a statement on January 5, saying that Chinese smartphone manufacturer Xiaomi’s local company in India had engaged in tax evasion and demanded that it pay a total of 6.53 billion rupees ($88 million) between April 2017 and June 2020 in taxes owed.
Xiaomi naturally denied the claim, saying that company adheres to legal and compliant operations around the world and abides with relevant laws and regulations of each jurisdiction in which it operates. What it forgets that it should abide by the I do an laws as Indian Tax men are only concerned with Indian laws.
Xiaomi said in a statement that the Indian authorities are asking Xiaomi to pay back the import taxes on the royalty and license fees that are not related to Xiaomi’s current business, adding that the official statement from the Indian authorities is not a final decision. So what Xiaomi has to pay for its past sins, without fail.
Indian tax authorities launched a broad investigation into Chinese companies operating in India on tax and income issues in December last year, including Chinese mobile companies Oppo, Xiaomi and OnePlus.
Chinese mobile phone brands Once highly popular in the Indian market, with their market share exceeding that of local Indian brands, are now being shunned by the public at large. People are deciding that they will not by Chinese products even if they are cheaper.
Xiaomi led the Indian smartphone market shipments in the third quarter of 2021 holding a 22 percent share, per Counterpoint’s latest research. The total Indian smartphone shipments cross 52 million units in the third quarter. However Xiaomi market share has already started declining. Earlier Xiaomi, Samsung, Vivo, Realme, and Oppo were the top performing brands, in that order. After Galwan incidents, Indians do not want the Chinese companies to further expand investment in the Indian market.
