The Volkswagen Group, including brands like Volkswagen, Audi, Skoda, Porsche, and Lamborghini, is under scrutiny for allegedly evading $1.4 billion (₹11,865 crore) in import duties in India. Authorities accuse the group of misclassifying imported car parts to bypass higher tax rates, a charge the company denies.
The alleged tax evasion includes popular car models such as:
India imposes various tax rates on imported car components to encourage local manufacturing:
These policies aim to foster domestic production and reduce dependence on imports.
Authorities claim Volkswagen intentionally misclassified CKD kits as “individual components” to pay lower import duties. This misclassification allegedly allowed the company to evade taxes over several years.
Key Findings:
Volkswagen uses two proprietary inventory systems, NADIN and ProCKD, to handle parts and manufacturing orders.
Parts are consolidated at regional centers before shipping to India, where they are tagged with unique IDs to streamline assembly.
The company denies any wrongdoing, claiming its practices are part of a long-established logistical model designed for efficiency.
If proven, this could be one of the largest cases of import duty evasion in India. The allegations come at a challenging time for Volkswagen, which faces stiff competition in the Indian auto market.
