Tax Probe Targets Google, Amazon, and Apple with INR 5,000 Crore Demand.

In connection with an ongoing 2021 investigation, the Income Tax Department is intensifying its scrutiny of Google, Amazon, and Apple,.

In connection with an ongoing 2021 investigation, the Income Tax Department is intensifying its scrutiny of Google, Amazon, and Apple, demanding detailed explanations on their transfer pricing practices, as reported by Economic Times.

The Indian arms associated with the matter are Apple India Pvt Ltd, Amazon Seller Services India Pvt Ltd and Google India Digital Services Pvt Ltd.

Sources suggest that the tax demand may surpass INR 5,000 crore, following the rejection of explanations provided by these tech giants. Apple India Pvt Ltd, Amazon Seller Services India Pvt Ltd, and Google India Digital Services Pvt Ltd are the companies under investigation. Authorities are closely examining potential discrepancies in their financial dealings to ensure compliance with tax regulations.

The tax department is delving into transfer pricing methodologies, potentially uncovering tax liabilities for Google, Amazon, and Apple totaling INR 5,000 crore. The investigation spans multiple assessment years, progressing through various stages of examination and litigation. Notably, Amazon and Apple have enlisted PwC for representation. Industry insiders suggest routine queries from the department, hinting at differences in tax calculation methodologies.

Transfer pricing, a specialized accounting method, scrutinizes related entities’ transaction pricing. The ongoing inquiry focuses on major tech players, examining diverse segments like advertising, marketing expenses, royalty payments, and software development.

The dispute centers on whether these transactions qualify as “international,” subject to transfer pricing adjustments, prompting discussions across regulatory forums. Apple, with a market capitalization nearing $3 trillion, stands as the world’s most valuable company. Meanwhile, Google’s parent company, Alphabet Inc, claims the fourth position in market valuation rankings, with Amazon securing the fifth spot.

Source:https://www.indiatoday.in/business

To know more visit:https://telecastindia.in/

Leave a Reply