Kia Faces $155 Million Tax Evasion Allegations in India Over Import Practices

India’s tax authorities have accused Kia’s local subsidiary of evading $155 million in import duties by allegedly splitting shipments of components for its Carnival minivan to pay lower taxes. A confidential notice alleges Kia imported parts via separate consignments through different ports, classifying them as individual components (10-15% duty) instead of complete knocked-down (CKD) units (30-35% duty). The government claims this tactic avoided detection and reduced liabilities. Kia India denies wrongdoing, stating it has submitted evidence to authorities and remains compliant. If penalties apply, the automaker could face a total payout of $310 million. The dispute mirrors Volkswagen’s recent $1.4 billion tax challenge.

Source: Indian Tax Authority Notice & Kia India Statement, February 5, 2025