Revenue dept turns down Apple's tax incentive demand

Co has plans to set up plant in B'luru

 In a setback to US-based iPhone-maker Apple’s India dream, the government has said no to the tax concessions demanded by the company.

The Department of Revenue in Commerce Ministry said ‘no’ to the tax incentives which among other things included relaxation in the 30% local sourcing of components which other manufacturers did not enjoy.

Official sources said that exceptional tax concessions to any company was not being considered at the moment. “Decision is taken for everyone. So no company-specific decision could be taken,” they said.

Apple had also demanded a 15-year customs duty exemption on manufacturing and raw materials, components and capital equipment for smartphone manufacturing in India.

The technology major had already announced it would setting up a manufacturing unit in Bengaluru, and had made presentations to the Commerce Ministry officials regarding that.

However, when the Department of Industrial Policy and Promotion moved the demands made by Apple to its revenue counterpart, they were rejected. Last month, Revenue Secretary Hasmukh Adhia had made a remark that concessions sought by the company would not fit into the proposed Goods and Services Tax regime.

Apple had made a detailed presentation to the ministry officials on January 25, and indicated that it was ready with a blueprint to manufacture the iPhone in India.

Earlier, Apple had also sought the government’s okay to bring used smartphones and assemble them locally. The government had rejected the proposal.

Apple’s sales have drastically fallen in the US and China, which were its major markets. Now, the company is targeting India, the fastest-growing smartphone market in the world.

The company has its manufacturing unit in China, but not in India. In India, it does not even have a wholly-owned store and sells its products through distributors. In China, it sells products through its own stores.

Apple gets a jolt

Apple wanted exemption from Customs duty on imports of components, equipments for 15 years

The company also demanded relaxation in the mandated 30% local sourcing of components

The US company represented its demand to DIPP Secretary Ramesh Abhishek