India calls for Xiaomi pay practically $88 million in import duties after tax evasion probe

An attendee holds a Xiaomi Corp. Mi A1 twin digital camera machine through the smartphone’s launch in New Delhi, India, on Tuesday, Sept. 5, 2017.

Anindito Mukherjee | Bloomberg | Getty Photos

India has demanded the native arm of Chinese language smartphone maker Xiaomi to pay 6.53 billion rupees ($87.8 million) in import taxes, following an investigation.

The Directorate of Income Intelligence carried out a probe which led to the restoration of paperwork throughout searches of Xiaomi India premises, a Finance Ministry assertion stated Wednesday.

“Throughout the investigations, it additional emerged that the ‘royalty and licence payment’ paid by Xiaomi India to Qualcomm USA and to Beijing Xiaomi Cell Software program Co. Ltd., China (associated celebration of Xiaomi India) weren’t being added within the transaction worth of the products imported by Xiaomi India and its contract producers,” it stated.

“By not including ‘royalty and licence payment’ into the transaction worth, Xiaomi India was evading customs obligation being the helpful proprietor of such imported cellphones, the components and parts thereof,” the assertion added.

After finishing the investigation, the DRI issued three “present trigger” notices to Xiaomi associated to the restoration of 6.53 billion rupees for the interval between April 2017 and June 2020. These notices are a sort of court docket order that requires a number of of the events to a case to justify, clarify or show one thing to the court docket.

Xiaomi didn’t reply to CNBC’s request for remark.

This isn’t the primary time India has taken motion towards Chinese language know-how corporations.

Final yr, the South Asian nation banned 118 apps with hyperlinks to China, citing nationwide safety dangers. It got here on the peak of geopolitical tensions between each international locations.


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