CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. India Releases Nokia's Assets

India Releases Nokia's Assets

by Mary Swire,, Hong Kong

16 December 2013

Microsoft's planned takeover of Nokia took an important step this week when a New Delhi court released the mobile phone manufacturer's Indian assets.

The assets were seized by the Indian tax authorities earlier this year, in an effort to claw back taxes it says Nokia owes. The company has been asked to pay a INR20.8bn (USD364.2bn) bill for back taxes relating to the period between 2006-07 and 2011-12. The Government claims that payments made for software used in devices produced in India, and supplied by Nokia's parent companies, are classifiable as royalties. They would, therefore, be subject to tax at 10 percent.

Nokia appealed to the New Delhi High Court to unfreeze the assets in time for Microsoft's takeover deadline yesterday. It proposed that the entire proceeds of the sale of its Chennai factory to Microsoft – estimated at INR22.5bn – would be handed over to the taxman.

The Court's ruling means that Microsoft should now be able to take control of the factory, but on the condition that the suggested INR22.5bn is deposited in an escrow account as a security.

It was not all good news, however. The Court did not settle the tax dispute, and it is thought that the Government could recalculate the sum it says Nokia owes. If it does, Nokia may face a total tax liability of around USD1.1bn.

TAGS: court | compliance | tax | tax compliance | India | tax avoidance | royalties | law | tax authority | tax planning | revenue statistics | telecoms | Tax | Tax Evasion

To see today's news, click here.


Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »

Stay Updated

Please enter your email address to join the mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.

To manage your mailing list preferences, please click here »