New Delhi: The government has detected Rs 9,075 crore worth of tax evasion by Chinese mobile handset makers since April 2017, of which the Indian tax authorities have been able to recover only Rs 1,630 crore, or 18 per cent, so far, data presented to Parliament has revealed.
Minister of State for Electronics and Information Technology Rajeev Chandrasekhar Friday replied to a question in the Rajya Sabha on tax evasion by Chinese handset makers, and provided a year-wise break-up of the evasion detected and the recovery so far since 2017-18.
Chandrasekhar also said the Chinese companies generate substantial turnover in India and also employ a large number of workers here.
“Their cumulative turnover in 2021-22 was estimated to be Rs 1.5 lakh crore in India,” he said in the written reply. “The total direct employment generated by them in their manufacturing operations is more than 75,000. They also have sales and operational workforce of around 80,000 workers.”
The data provided by the minister showed that the government has detected large amounts of customs duty and Goods and Services Tax evasion by these Chinese companies.
In total, the evasion of customs duty amounted to Rs 7,966 crore from 2017-18 to 2023-24, as of 1 July, 2023. In addition to this, the evasion of GST amounted to Rs 1,109 crore between July 2017 — when GST was implemented — and June 2023.
Compared to this, the tax authorities have recovered only Rs 604.5 crore of the customs duty evaded, and Rs 1,026 crore of the GST evaded.
The largest evaders of both customs duty and GST, according to the data provided by the ministry to Parliament, are Oppo Mobile India and Xiaomi Technology India.
The government stated that it has detected Rs 4,403.3 crore worth of customs duty evasion by Oppo Mobile India — which is about 55 per cent of the total customs duty evaded. Of this, it has recovered just Rs 476.8 crore so far.
It has also detected Rs 683 crore of GST evasion by the company, and so far recovered Rs 738 crore. It was not made clear where the extra recovery had come from.
The government also said it has detected Rs 682.5 crore worth of customs duty evasion by Xiaomi Technology India from 2019-20 to 2021-22, and GST evasion of Rs 168.6 crore since July 2017. Of this, it has recovered only around Rs 11 crore of the customs duty and Rs 82.04 crore of the GST.
ThePrint has reached out to both companies via email for their comments and will update this copy as and when a response is received.
The information provided to Parliament showed that in all nine cases where customs duty evasion was detected, action in the form of show-cause notices, recovery of duty and penalty, and issuance of pre-notice consultation letters had been taken.
With regard to 13 cases of GST evasion, the reply said: “Investigation has been initiated and companies are being persuaded to deposit the tax amount/interest/penalty as applicable.”
(Edited by Nida Fatima Siddiqui)
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