Emirates Airline evades $30 million in service taxes in India
New Delhi : Dubai’s Emirates Airline was found to have evaded almost $30m in service taxes in India over the last five years, according to authorities in the country.
Non-payment of the tax, which is levied on all airlines that pick-up passengers within India, was detected during a service tax audit. The total amount is INR1.75bn ($28.7m) and the airline is said to have deposited the sum with the government on October 10 after the deficit was discovered.
“The airline said it was not intentional, but we are verifying the claims. The airline said it follows a global accounting pattern and hence the error happened,” the country’s service tax commissioner Sushil Solanki was quoted as saying by the Times of India.
Solanki said that the airline, the world’s largest by international passenger traffic, was now liable to pay interest on the amount, although by how much is disputed.
India’s service tax department is said to be seeking to levy an interest rate of 24 percent, while Emirates claims that the applicable rate is only 13 percent.
A spokesperson for Emirates said: “There was an inadvertent short payment of tax, and as a law-abiding company, we have voluntarily paid the same.”
Emirates is currently the largest foreign airline operating in India, operating 185 weekly flights to ten destinations. Its share of outbound traffic from the country is about 13 percent. Its weekly seat capacity is 54,200, although it has been lobbying the Indian government for an increase.
Source: arabianbusiness.com
