Samsung Issued with Tax Demand Over Tablet Imports to India
Published on: 18th Mar 2014
By: Ian Mansfield
Samsung has been issued with a show notice by the Indian tax collectors who are demanding an explanation as to why the company is alleged to have avoided Rs 70 crore (USD11.4 million) in import duties.
The Directorate of Revenue Intelligence (DRI) is claiming that Samsung imported around Rs 420 crore worth of tablets into the country a couple of years ago, but recorded them as mobile phones in the manifest -- which then resulted in a lower rate of import duty.
Import duty on tablets would be 12 percent of their value, whereas import duties on mobile phones was just 1 percent.
Samsung denies any wrong doing and says it is cooperating with the authorities.
The issue does however raise the potential clash as to when is a mobile phone not a tablet, and how soon before there is a dispute over so-called phablets as to which rate of tax they should pay.