Apple Lobbying India to Change Tax Law

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 BKC Mumbai India media preview hero
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.

Note: Due to the political or social nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tags: India, Tax

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Top Rated Comments

con2apple Avatar
11 weeks ago
The question is not whether Apple lobbies. But how.
With the same old lies and phrases.
"Innovation is being hindered," "We can't create jobs," "Apple's influence is being decimated," and so on and so forth...

To this day, I don't understand why people support such claims and act against their own interests.
Here: Indian newspapers and citizens (although this applies to every country, we usually talk about the US and the EU).

It's simple: A state finances itself through taxes.
Roads, police, water supply, electricity, waste, administration

Everyone who works in a country – from simple farmers to billion-dollar corporations – benefits from a functioning state. They benefit from built roads, protection by the police, and carefully maintained power lines.
Even Apple calls the police and expects its lawsuits to be heard in court.

But Apple does not want to contribute to the financial basis of the state like everyone else. Neither in India nor in the US or everywhere else.

And the question is, why is this attitude supported by ordinary people?
What does the Apple fan, who spends $5,000 at Apple every year, get out of it if the corporation does not contribute to the infrastructure that the fan also uses?

Because one thing is clear:
Apple customers have never benefited from discounts. Apple has never lowered prices because it made more profit.
Score: 23 Votes (Like | Disagree)
arcite Avatar
11 weeks ago
Apple's market cap is almost greater than India's entire GDP....India is a country of 1.45 billion people - most of whom are still incredibly poor. India still has the world's highest child malnutrition rates. Of course, there is a 'modern side' of India, where these hi-tech factories are built....but how is India to continue developing itself if it merely becomes a low cost manufacturing and assembly destination....where cheap labor have few rights, and middling pay....with most workers having little hope to make it to the middle class. Apple is a global behemoth, but are they above the authority of the governments in the countries they operate?.... in other words, India might be the last stand in the fight back against neoliberalism. We shall see.
Score: 11 Votes (Like | Disagree)
mattwolfmatt Avatar
11 weeks ago

I'd much rather every country introduces laws like that. That sounds great.
Who pays corporate taxes?

You and I do.
Score: 10 Votes (Like | Disagree)
Alfred.Woodden Avatar
11 weeks ago
Pay your taxes, Apple. Seriously.
Score: 8 Votes (Like | Disagree)
ItsASpider Avatar
11 weeks ago
I'd much rather every country introduces laws like that. That sounds great.
Score: 8 Votes (Like | Disagree)
turbineseaplane Avatar
11 weeks ago

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.
I don't know guys ...

The Indian law seems to make sense to me in the context of how the modern world now works.
Score: 7 Votes (Like | Disagree)