From mint · Bobins Vayalil Abraham · · 1m 20s
Scotch imports under tax probe linked to India-UK trade deal
Tax officials probe Pernod Ricard and Diageo for wrongly classifying Scotch imports under India-UK trade deal.
In brief
Tax officials probe Pernod Ricard and Diageo for wrongly classifying Scotch imports under India-UK trade deal. Tax authorities in India are investigating Pernod Ricard and Diageo for misclassifying bulk Scotch imports to claim reduced duties under the India-UK trade deal that took effect July 15. Originally reported…
Tax probe targets Scotch imports
Tax officials in India are investigating Pernod Ricard and Diageo for allegedly misclassifying bulk Scotch imports to claim reduced duties under the India-UK trade deal.
“Tax officials were looking into whether the two companies were eligible for the reduced import duty which came into effect on July 15.”
India-UK trade deal reduces Scotch duties
Under the trade pact that took effect on July 15, India slashed import taxes on Scotch to 75% from 150%.
“Under the trade pact, which took effect on July 15, India agreed to slash import taxes on certain Scotch imports to 75%, from 150%.”
Tax inspectors question companies
Tax inspectors recently visited Pernod's India headquarters near New Delhi to question executives about Scotch imports.
“According to Reuters, last week, tax inspectors made an unexpected visit to Pernod's India headquarters near New Delhi, where they questioned company executives about their Scotch imports.”
Companies under investigation
Diageo and Pernod Ricard dominate India's $65 billion alcohol market and import bulk Scotch concentrates for brands like Royal Stag and Blenders Pride.
“Diageo and France's Pernod Ricard dominate India’s $65 billion alcohol market.”
Companies respond to probe
Pernod Ricard said it is cooperating with tax authorities and providing all requested information, while Diageo stated it has always complied with local laws.
“Pernod, in a statement, told that it is cooperating with the Directorate of Revenue Intelligence and providing all information requested, adding it was committed to addressing any questions from the authorities.”
Pernod faces additional tax issues
Pernod is already under antitrust scrutiny in India and faces a $314 million back-tax dispute over alleged Scotch whisky undervaluation.
“Pernod is already facing antitrust cases in India and faces a $314 million back-tax dispute in India over alleged Scotch whisky undervaluation.”
The big picture
Tax authorities in India are investigating Pernod Ricard and Diageo for misclassifying bulk Scotch imports to claim reduced duties under the India-UK trade deal that took effect July 15.
