In recent years, relations between India and China have become quite bitter. Although it started with the border tension in June 2020, it has spread far – the Modi government has taken various steps like banning Chinese apps, imposing rules on the import of Chinese products, etc. Not only that, Chinese smartphone brands that are widely popular in the country have also come under the notice of the Centre. Over the past decade, companies like Xiaomi, Oppo, Vivo, whose various handsets have become everyday companions of the common man, have been accused of tax evasion against those Chinese mobile manufacturers. It is being said by the government that these companies are wrongly remitting money earned in India abroad. Even for this reason, investigations are being conducted against them for several months. In that case, although Xiaomi and Oppo have repeatedly dismissed this complaint, this time there has been an uproar over this matter. Recently, the government has again raised the issue of tax evasion by these companies in Parliament; A tax related statistic is also presented.
Chinese companies are smuggling money abroad without paying taxes?
According to the government’s complaint, companies like Xiaomi, Oppo are saving tax by showing business losses in India or by not disclosing the exact figures of their profits and income. Also they somehow remit those savings abroad. While the Chinese companies have denied the allegation, the government has informed Parliament that three companies – Xiaomi, Oppo and Vivo – have evaded the Indian government to the tune of Rs 8,000 crore in taxes over six years. However, out of this, about Tk 1,025 crore has been recovered.
Based on the figures provided by the government, Xiaomi has evaded tax to the tune of Rs 653 crore between 2019 and 2020, compared to Rs 23.99 crore and Rs 4.61 crore in 2020-21 and 2022 respectively. In this case, Oppo, between 2017 and 2021, totaled Rs 4,403 crore
Alleged tax evasion. Brands like Vivo, OnePlus, Realme, Tecno, Infinix are guilty of the same. However, it should be noted that Xiaomi, which has occupied the position of the leading mobile brand in the country for the past few years, has paid a compensation of Tk 13,30,143 in this case.
Government investigation has affected Xiaomi’s business
Chinese mobile companies have repeatedly denied allegations of tax evasion, saying they fully comply with local regulations in India. In that case, the government report says otherwise, besides this issue has had a big impact on the business of the companies in this country. For example, buyers have reduced their reliance on Chinese smartphones for shipping 5G phones, even to the point where Xiaomi has lost the number one smartphone brand in India after a long time!