Samsung Evaluates Legal Recourse Following India's Over Rs 5,000 Crore Tax Demand
Click to start listening
Synopsis
Samsung has stated it fully complies with Indian laws as it evaluates legal options regarding a $601 million tax demand related to alleged import duty evasion on telecom equipment, following scrutiny of its classification methods.
Key Takeaways
- Samsung is assessing legal options in response to a significant tax demand.
- The tax claim is a considerable portion of Samsung's profits in India.
- Misclassification of telecom components is under scrutiny.
- Samsung insists it complies with local laws and customs regulations.
- India's smartphone exports have grown significantly, driven by companies like Samsung.
New Delhi, March 25 (NationPress) Following the Indian government's demand for Samsung to pay $601 million (around Rs 5,174 crore) in overdue taxes and fines for purportedly evading import duties on essential telecom equipment, the South Korean conglomerate stated on Tuesday that it fully adheres to local laws and is now evaluating legal options.
This tax claim represents a notable fraction of Samsung's net earnings in India, which reached $955 million last year.
Samsung's network division, which imports telecom gear, has allegedly faced scrutiny for misclassifying key transmission elements used in mobile towers.
Reportedly, these telecom components were imported and sold to Reliance Jio.
However, Reliance Jio has not yet responded to the reports.
In a statement to IANS, a representative from Samsung India noted, "Samsung is a responsible corporation and fully complies with the laws in India".
"The issue involves the interpretation of goods classification by Customs. We are evaluating legal options to ensure our rights are fully safeguarded," the spokesperson added.
Samsung contended that the components should not incur any import duties and that officials had recognized its classification method for several years.
However, Customs officials have not released any statements regarding this matter.
Meanwhile, 'Made in India' smartphone shipments experienced a 6 percent increase year-on-year last year, fueled by rising exports from Apple and Samsung.
According to Counterpoint Research’s 'Make in India' Service report, Apple and Samsung together comprised approximately 94 percent of India's smartphone exports in 2024.
In 2024, Samsung maintained its status as a leading entity in India's electronics manufacturing, achieving a 7 percent year-on-year growth driven by increasing exports.
The government’s Production-Linked Incentive (PLI) scheme has motivated global manufacturers to establish or expand their production facilities within the country.
