India says 27 firms underpaid tax in share transfers in last fiscal year
REUTERS - India said 27 companies, including the local units of HSBC (HSBA.L), Standard Chartered (STAN.L) and Vodafone (VOD.L), underpaid taxes in the last fiscal year after they sold shares to their overseas arms too cheaply.
Finance Minister P. Chidambaram named the companies in a written reply on Friday to a lawmaker's question about which companies were in conflict with the tax department over transfer pricing issues.
Transfer pricing, or the value at which companies trade products, services, shares or assets between units across borders, is a regular part of doing business for a multinational company and influences tax liabilities.
The issue has been high on the political agenda in India and the country has stepped-up enforcement of tax collections and actions against global companies as it aims to make up for a revenue shortfall and head off a credit rating downgrade.
India's tax department also made "transfer pricing adjustments" involving the local unit of Royal Dutch Shell (RDSa.L), the finance minister said.
Shell's India arm filed a petition in the Bombay High Court on Wednesday challenging the claims by the local tax authorities that a share sale to its overseas parent in 2009 was undervalued by about 152 billion rupees.
British-based mobile phone giant Vodafone said in February it had received a fresh transfer pricing order in India over the issue of shares by a unit, adding to its tax woes in the country. It has said it would challenge the order.
A Vodafone spokesman in London did not immediately respond to a request for comment on Friday.
Mumbai-based spokesmen for HSBC and Standard Chartered declined to comment.
India's top mobile operator Bharti Airtel (BRTI.NS) and some units of the diversified Essar conglomerate, including Essar Power and Essar Investments, were also named by the minister in his statement.
Essar group declined to comment and Bharti Airtel did not have an immediate comment.
India has targeted several multinational companies in recent years for tax audits on transfer-pricing, but over the past 12 months has widened the scope of the investigations, tax officials have said.
(Reporting by Sumeet Chatterjee in MUMBAI; Editing by Elaine Hardcastle)
- Tweet this
- Share this
- Digg this
- U.S. strikes have slowed Iraq militants but not weakened them - Pentagon
- Comedian Joan Rivers remains in serious condition at N.Y. hospital
- Exclusive: Reliance plans $13 billion projects including new refinery
- Ukraine seeks to join NATO; defiant Putin compares Kiev to Nazis
- Swedish carrier backs out as first Bombardier CSeries operator
The Central Bureau of Investigation (CBI) has closed a coal scam case against billionaire Kumar Mangalam Birla and a former top bureaucrat that emerged in 2012 after an auditor's report on revenue loss to the exchequer from allocations of coal blocks. Full Article
Exclusive: Reliance plans $13 billion projects including new refinery. Full Article
In race for bigger margins, drug makers willing to lose the India "advantage". Full Article