DGGI Summons 10 Foreign Airlines Operating In India Over Alleged GST Evasion

February 16, 2024

The Directorate General of GST Intelligence (DGGI) has summoned 10 foreign airlines operating in India over alleged Goods and Services Tax (GST) evasion. The GST intelligence has sought detailed clarification of tax evasion from British Airways, Lufthansa, Singapore Airlines, Etihad Airways, Thai Airways, Saudi Arabia Airlines, Kuwait Airways, Emirates, Qatar Airlines, Oman Airlines and Air Arabia on account of import of services from head office by Indian branch offices.

The crackdown on GST leakage by foreign airlines operating in India and headquartered abroad comes in view of the non compliance under reverse charge mechanism for rentals, maintenance of aircraft, crew salary and other local expenses.

DGGI conducted search operations in October 2023

The foreign airlines have allegedly not paid GST liable for services coming from abroad. The foreign airlines are permitted by the Reserve Bank of India to remit forex related to passenger sales and cargo sales, while other services offered by the head office in India are liable for GST.

In October 2023, DGGI had conducted search operations at Indian offices of foreign airlines, including Etihad, Emirates, Saudi Airlines, Qatar Airways, Air Arabia, Oman Air, and Kuwait Airways for alleged tax evasion on account of import of services from head office by Indian branch offices.

[The Free Press Journal]