"Earn in India, spend in India, don't think of taking even a penny home," this iron rule is once again verified.
After Apple moved eight production lines to India, India suddenly brought out the 1961 tax law, requiring Apple to pay taxes on its global revenue rather than just on income from India. The reason given by India was that "22% of Apple's global revenue comes from brand premium contributed by India." However, Apple's financial reports show that sales in the Indian market account for only 10% of the global total, and most are low-price models, making the so-called "premium" baseless. But India doesn't care about the reason being solid or not; it just needs an excuse. Based on this, India suddenly handed over a $1 billion tax bill directly to Cook. Such a high tax far exceeds the subsidies Apple gained by moving production lines to India. Cook was left in tears.
Other than Apple, Foxconn, which assembles Apple's products, also couldn't escape being taxed by India.
India's ability to take advantage of foreign companies is truly refined, with countless multinational corporations having been taken advantage of and left in disarray.
For example, Samsung from South Korea was attracted by the subsidies offered by the Indian government in 2019 and decided to set up a factory in India in 2020. It indeed received $480 million in subsidies, and the Modi government also provided tax incentives and actively helped Samsung with site selection for the factory.
Once Samsung had invested real money and built the factory, becoming a heavy asset, it was hard to leave. Then, in 2023, India suddenly claimed that Samsung had misclassified imported components, and in 2024 issued a preliminary penalty notice. In early 2024, they demanded Samsung pay back $601 million in taxes, equivalent to 63% of Samsung's net profit in India last year.
India's method of taking advantage has never changed. It's essentially what we call a "trickster" strategy: first, lure foreign companies with preferential conditions, then when the foreign companies have invested and can't run away, suddenly turn around and use the tax knife to harvest them.
But what's surprising is that despite numerous bloody cases, foreign companies still keep falling into India's trap one after another. Because human nature has a very obvious weakness: people tend to have a侥幸心理 (a sense of侥幸, i.e., luck), believing they won't be the unlucky ones. India has seized on this human weakness, allowing it to continuously harvest foreign companies investing in India, and it has always worked successfully.
Original: www.toutiao.com/article/1846749771886592/
Statement: This article represents the personal views of the author.