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Photo courtesy of Yonhap News |
[Alpha Biz= Kim Jisun] LG Electronics’ Indian subsidiary has received a tax demand notice of about 79.8 million rupees ($150,000) from Indian tax authorities over alleged irregular claims related to the Goods and Services Tax (GST).
According to local media reports on March 12, the Corporate Circle-2 Joint Commissioner of Taxation in Greater Noida, Uttar Pradesh, issued the original assessment order on March 10. The demand covers the 2019–2020 fiscal year and includes principal tax, interest and penalties.
Tax authorities claim that LG Electronics India improperly claimed input tax credit (ITC) for employee transportation services, specifically bus services provided for staff commuting.
Officials determined that the transportation expenses fall under restricted ITC categories under Section 17(5) of India’s GST law, arguing that the service is not a legally mandated employee benefit and cannot be considered a direct business expense.
LG Electronics India said it disagrees with the tax authority’s interpretation. The company maintains that the input tax credit was claimed in accordance with GST regulations and plans to file an appeal within the designated deadline.
The company also said the tax demand will not have any material impact on its financial condition or business operations.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
