Apple lobbies India to change tax law seen hindering its expansion, sources say

Apple is lobbying India’s government to amend its income tax law so the company isn’t taxed for owning expensive iPhone manufacturing equipment used by its contract partners. The issue is seen as a key obstacle to Apple’s future expansion in India.

As Apple increases production in India to reduce reliance on China, its market share in the country has doubled to 8 percent since 2022. India now accounts for about 25 percent of global iPhone shipments, while China’s share has dropped to 75 percent.

Apple’s partners, Foxconn and Tata, have invested billions in Indian factories, but most of the cost goes toward high-end machinery owned by Apple. Under current Indian law, this ownership could create a “business connection,” making Apple’s profits subject to Indian taxes—unlike in China, where similar arrangements are tax-free.

Apple executives have been in talks with Indian officials for months, warning that the rule could hinder growth. Industry experts say updating the 1961 law would make it easier for Apple to expand and strengthen India’s position as a global manufacturing hub.

Credit : CGTN