LG, Samsung Face Probe For Paying Lower Tariffs On OLED TV Parts In India

Photo / Illustration: Haldwani Times News Desk

<p>LG Electronics and Samsung are facing a probe from Indian authorities for allegedly paying lower tariffs on imported display parts used in high-end TVs.</p> <p>Prolonged probes into import tariffs and taxes have been a concern for foreign investors in India, involving companies such as Samsung and Volkswagen. Indian officials, however, say the investigations are aimed at enforcing the country’s laws.</p> <p>The Directorate of Revenue Intelligence (DRI) has questioned the companies’ use of a 5% concessional tariff on OLED “open cell" glass screens. Officials reportedly believe the lower rate applies to LCD and LED components, which are used more widely in mass-market televisions. Reuters, citing two sources, reported that the DRI’s view is that OLED components should attract a 15% duty.</p> <p>Samsung, LG Could Face Penalties Of Up To 100% If Found Guilty</p> <p>Samsung and LG are contesting the interpretation, maintaining that OLED technology is an advanced form of LED and should receive the same tariff treatment, according to the sources. If authorities determine that duties were underpaid, companies could face tax demands and penalties of up to 100% of the allegedly evaded amount, although such orders can be challenged in court.</p> <p>DRI officials recently visited Samsung’s Gurugram headquarters, while LG received written queries and has submitted its response along with an unspecified voluntary deposit toward any additional duty that may ultimately be sought.</p> <p>Samsung said it is “reviewing the matter and cooperating fully with the relevant authorities, adding it is firmly committed to complying with all laws." The investigation comes as industry groups lobby for OLED components to receive the 5% concessional rate. In confidential letters, the groups said the tariff law “restricts the benefit" to LCD and LED parts and creates an “anomalous situation".</p> <p>“Manufacturers of more advanced OLED TVs are denied the same benefit, resulting in higher input costs and reduced competitiveness," the letters said.</p> <p>Indian authorities, through the Directorate of Revenue Intelligence, are investigating LG and Samsung for allegedly paying a lower 5% concessional tariff on imported OLED display parts instead of the required 15% duty.</p> <p>If authorities determine that the companies underpaid their import duties, Samsung and LG could face tax demands and penalties reaching up to 100% of the allegedly evaded amount.</p> <p>Samsung and LG are contesting the authorities&#x27; interpretation by maintaining that OLED technology is an advanced form of LED and should therefore receive the same concessional tariff treatment.</p>