Huawei and Vivo, both Chinese firms, are under strong scrutiny from the Indian government. Both the companies have been accused of not paying the tax by using unlawful tactics. Vivo India has been accused of remitting Rs 62,746 crore to China. Out of the company’s total sales proceeds of Rs 1,25,185 crore, Vivo India has been accused of sending half of it back to mainly China. The Enforcement Directorate (ED) said that this move from Vivo India was made to be able to disclose huge losses in Indian incorporated companies to avoid paying taxes within India.
As per ET Telecom, ED has seized over 119 bank accounts of several entities to the tune of Rs 465 crore. The seizure by ED has been made under relevant provisions of the Prevention of Money Laundering Act.
What is Huawei India Doing?
Huawei India has been under the strict eyes of the Income Tax Department. The company is accused of sending large amounts of money to its parent in China in the form of dividends. This helped the company in reducing taxes in India.
Even when the company’s revenue was falling, it repatriated Rs 750 crore, said the I-T department. Huawei’s bank accounts were frozen by the department in February. There was a very big search on the premises of Huawei as the company was accused of tax evasion.
Huawei has claimed in its petition that it has not done anything wrong, and when its accounts were attached by the I-T department without any notice, its business was affected. The tax department said that Huawei’s petition is just a “ploy” for interfering with the departmental proceedings and avoiding paying the taxes.
To date, Huawei has not presented its books of accounts to the income tax department, making it impossible for the department to ascertain the truth in the amount that it had declared as income.
Things such as this would hurt the consumer sentiments towards Chinese companies in general. Especially when a name such as Vivo is accused of evading taxes while earning from India, it would be a huge disappointment for the fans of the company.