Kia Becomes Latest Global Firm To Face Tax Troubles In India

Indian tax authorities have sent a confidential notice to South Korean carmaker Kia Motors, accusing it of evading millions of dollars in taxes.

Kia operates a manufacturing facility in the southern Indian state of Andhra Pradesh and has sold more than a million cars in India since its launch in 2019. I Photo: Kia India Facebook

The amount could be as high as $155 million (£125 million), and the notice was issued in April last year, according to Reuters. Nikhil Inamdar reported for BBC News.

Kia India told the BBC that it has already filed a "detailed response supported by comprehensive evidence and documentation" to the tax claim, which was issued by a customs commissioner in Chennai.

Kia operates a manufacturing facility in the southern Indian state of Andhra Pradesh and has sold more than a million cars in India since its launch in 2019.

Reuters, which first reported the story, stated that the government's 432-page notice accused Kia of importing components for its Carnival model in separate shipments rather than as a single consignment, a tactic that significantly reduces customs duties.

Last year, Indian officials issued a similar tax notice for $1.4 billion to Skoda Auto Volkswagen India, a unit of the German auto giant Volkswagen. Volkswagen has challenged the demand in the Bombay High Court and stated that it is "availing itself of all legal remedies."