Apple is lobbying India to amend a decades-old tax law that could expose the company to billions of dollars in taxes on equipment it owns inside local iPhone factories, Reuters reports.


Apple is reportedly urging the Indian government to modify provisions in the Income Tax Act of 1961 to ensure it is not taxed simply for owning high-value manufacturing machinery supplied to its contract manufacturers, including Foxconn and Tata Electronics. The issue is a potential obstacle to Apple's expansion in the country.

Indian law currently treats such ownership as creating a "business connection", effectively making the company's global ‌iPhone‌ profits taxable in India. In China, Apple operates under a different model. The company buys the specialized machinery required to assemble iPhones and provides it to its manufacturing partners without becoming liable for local corporate tax. In India, the same practice could trigger significant tax exposure under existing law.

Legal experts say India's stance may stem from precedents such as the 2017 Supreme Court ruling against Formula One, which held that the UK-based company was liable for local taxes during its Grand Prix event because it exercised control over the circuit despite not owning it. A similar interpretation could apply if Apple were to maintain ownership of machinery used in Indian factories.

Discussions with the Indian government on taxation rules impacting Apple are said to be ongoing. The effort comes amid rapid expansion of its Indian operations. Since 2022, the country's share of global ‌iPhone‌ shipments is believed to have increased fourfold to around 25%. While China still produces around 75% of all iPhones, India is increasingly viewed as a critical secondary hub as Apple diversifies its supply chain. Foxconn and Tata have together invested more than $5 billion to open five large manufacturing facilities for Apple in the country.
This article, "Apple Lobbying India to Change Tax Law" first appeared on MacRumors.com

Discuss this article in our forums

Apple and Samsung have reportedly issued cease-and-desist notices to Xiaomi in India for an ad campaign that directly compares the rivals' devices to Xiaomi's products. The two companies have threatened the Chinese vendor with legal action, calling the ads "disparaging."


Ads have appeared in local print media and on social media that take pot shots at the competitors' premium offerings. One full-page print ad published in April wished readers a "Happy April Fools' Day" if they believed the iPhone 16 Pro Max's cameras could match those on Xiaomi's recently launched 15 Ultra.

In March, another print ad described the triple lens array on the iPhone 16 Pro Max as "cute" and questioned whether it was "really the best," while touting the Ultra's higher camera specifications and more affordable price. Xiaomi has launched similar ad campaigns against Samsung.

Apple and Samsung contend that the tone of Xiaomi's promotions went beyond fair competition, and portrayed the global market leaders in a negative light. Comparative advertising in India is not prohibited provided they are fact-based and fair, but lawyers can legitimately get involved if the tone and language is perceived as mocking.


Samsung's promotional jabs at Apple have recently taken a more understated approach. Its ads typically don't call out iPhones outright, and instead spotlight features where Samsung believes it has the edge.

The tech giants' responses to this particular ad campaign indicate just how fiercely contested India's smartphone sector has become. As the country's two leading high-end vendors, both brands obviously see their reputation and market share as vital in one of the world's fastest-growing and most lucrative markets, and intend to defend them using all the legal tools at their disposal.
This article, "Apple and Samsung Push Back Against Xiaomi's Bold India Ads" first appeared on MacRumors.com

Discuss this article in our forums