Samsung has been ordered to pay $601 million in back taxes and penalties by the Indian government. The South Korean tech giant attracted this massive fine for allegedly misclassifying telecom equipment imports between 2018 and 2021 to evade customs tariffs. This is one of the most significant tax demands for foreign companies in India in recent years.
The Indian government hits Samsung with a $601 million fine for fraudulent imports
The dispute centers around the Remote Radio Head, a crucial transmission component used in 4G telecom towers. The Indian government claims that Samsung wrongfully avoided tariffs of 10-20% on imports worth $784 million from Korea and Vietnam. The company imported and sold these components to Reliance Jio, India’s largest telecom operator.
According to customs officials, Samsung “knowingly and intentionally” submitted false documentation to clear the imports without paying the required duties. The ruling, issued by India’s customs commissioner Sonal Bajaj, states that the company violated Indian laws and acted against business ethics to maximize its profits.
As such, authorities in India have ordered Samsung to pay a fine of ₹44.6 billion (approx. $520 million), which comprises unpaid taxes and penalties. Additionally, seven senior executives face individual fines totaling $81 million. The total fine of approx $601 million accounts for nearly two-thirds of Samsung India’s $955 million net profit last year.
The company has defended its actions, saying it has always complied with Indian laws. Samsung argues that the Remote Radio Head is not a transceiver and should not be subject to tariffs. “The issue involves the interpretation of classification of goods by customs,” its official statement reads. “We are assessing legal options to ensure our rights are fully protected.”
However, Indian tax officials presented internal documents from 2020, where Samsung itself described the component as a “transceiver”, contradicting its defense. The case highlights India’s stricter stance on foreign companies avoiding tariffs. Volkswagen is also facing a $1.4 billion back-tax demand in India.
