Volkswagen Files Lawsuit Against India Over $1.4 Billion Tax Demand

Volkswagen has initiated legal action against Indian authorities over a $1.4 billion tax claim, asserting that it violates New Delhi's import taxation regulations for car parts and jeopardizes the company's operations in India. The tax dispute centers on accusations that Volkswagen inaccurately classified imported car parts to avoid higher duties, potentially resulting in a $2.8 billion payout if the company is unsuccessful. Volkswagen maintains that its import procedures were transparent and compliant with the law, noting that it has communicated its part-by-part import strategy to the Indian government since 2011. The High Court in Mumbai is scheduled to commence hearings on February 5, with Volkswagen stressing that the tax demand undermines foreign investor confidence in India's business climate.