DGGI summons 10 foreign airlines operating in India over alleged GST evasion
According to sources, "DGGI has summoned Indian offices of all foreign airlines for alleged tax evasion on account of import of services from head office by Indian branch offices. And detailed clarifications have been sought, and DGGI is in talks with all foreign airlines."
In a major crackdown to curb Goods and Services Tax (GST) leakage by foreign airlines operating in India, the Directorate General of GST Intelligence (DGGI) is understood to have issued summons to the Indian offices of these airlines.
According to sources, "DGGI has summoned Indian offices of all foreign airlines for alleged tax evasion on account of import of services from head office by Indian branch offices. And detailed clarifications have been sought, and DGGI is in talks with all foreign airlines."
DGGI, the investigative arm under the GST regime, alleges that foreign airlines, headquartered abroad have branch offices in India that are permitted by RBI to remit forex related to passenger sales and cargo sales, however, other air services are offered by the head office abroad which include rental, maintenance of aircraft, crew salary, etc. Thus, these services coming from abroad were liable to GST under the reverse charge mechanism, which these airlines have not paid.
