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Vivo India Tried To Avoid Taxes, Transferred 50% Turnover To China

In order to avoid the tax payments in India, smartphone maker Vivo illegally transferred 50 per cent of its revenue to China, asserted by ED or Enforcement Directorate on Thursday. ED claims to have busted a large money laundering racket in which multiple Chinese and Indian companies are involved.

Vivo India Tried To Avoid Taxes

Vivo India Transferred 50% Turnover To China

The transferred amount from Vivo India is almost half of its turnover of ₹1.25 Trillion, as officials said without notifying about the time period of transactions. The case of the Chinese smartphone maker came to light when the intelligence agency found out that three Chinese nationals, all of them left India during 2018-2021, having 23 companies incorporated in India, which they were also assisted by a persona named Nitin Garg, a Chartered Accountant.

Three Chinese nationals are identified, one of them is Bin Lou, ex-Director Vivo, who left India in 2018. The other two are Zhengshen Ou and Zhang Jie, both left the country in 2021, as per officials.

In a statement about the matter, ED said, “These (23) companies are found to have transferred huge amounts of funds to Vivo India. Further, out of the total sale proceeds of Rs 1,25,185 crore, Vivo India remitted Rs 62,476 crore or almost 50 per cent of the turnover out of India, mainly to China.”

Further said, the large corpus was transferred in order to, “disclose huge losses in Indian incorporated companies to avoid payment of taxes in India.”

A statement was released after 48 locations of Vivo Mobiles India Pvt Ltd and its related companies were raided by ED on July 5.

On Tuesday a statement came from Vivo that said, “as a responsible corporate, we are committed to being fully compliant with laws.”

Agency said, “all due procedures as per law” during the raids conducted under the criminal sections of the Prevention of Money Laundering Act (PMLA), it alleged that “employees of Vivo India, including some Chinese nationals, did not cooperate with the search proceedings and tried to abscond, remove and hide digital devices which were retrieved by the search teams.”

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After the raid, ED also asserted that they have seized ₹465 Cr from 119 bank accounts, owned by various entities that are involved, with ₹73 lakhs cash and 2Kg weighted gold bars.

Afterwards, ED said, “The allegations (made by the ministry) were found to be true as the investigation revealed that the addresses mentioned by the directors of GPICPL did not belong to them, but in fact, it was a government building and house of a senior bureaucrat.”

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Rishabh Sharma

Rishabh is an experienced content writer and editor, he is working for Viralbake to cover a diversified range of categories. His articles mainly focus on providing information, being a travel guide, educating others, and also making people aware of technology, after all, he is a technophile. When not writing he can be found gaming, watching movies, and travelling.

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