Around USD30 million was discovered to have been unpaid as taxes by the Emirates Airlines. The said amount was for service taxes in India for the past five years and is tantamount to evasion according to Indian tax authorities.
The tax is levied on all airlines that pick up passengers throughout India. Its non-payment was detected during a service tax audit and its total amount is INR1.75 billion or USD28.7 million. The Dubai based airline had deposited the amount with the Indian government last October after the said deficit was first discovered.
According to Indian Service Tax Commissioner Sushil Solanki, "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."
Solanki said the airline, which is the world's biggest airline in terms of international passenger traffic, would be required to pay the interest over the amount. This amount though is still subject to agreement. The Indian Service Tax Department seeks to impose an interest rate of 24% while the Emirates say the imposable interest is only at 13%.
Emirates, through a spokesperson, said, "There was an inadvertent short payment of tax and as a law abiding company, we have voluntarily paid the same."
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