BBC reacts to Republic queries on tax evasion, assures cooperation with Indian authorities

The British Broadcasting Company (BBC) on Tuesday, responded to a question on tax evasion saying that it is "fully cooperating" with the Indian tax authorities. The UK-government-funded broadcaster stated in response to Republic's query after the former reportedly accepted to have paid lower taxes than its liabilities.

Responding exclusively to Republic, the British broadcaster said, "The BBC is cooperating fully with the Indian tax authorities' enquiries and will continue to do so. The process is ongoing and will take time to conclude. The BBC of course takes its tax obligations very seriously."

Notably, the UK-based broadcaster's admission to under-reporting its income in India over the past few years and that it may have paid lower taxes than its liability, follow the surveys conducted by the Income Tax Department at the company's offices in Delhi and Mumbai back in February.

BBC was in the hands of people with an agenda on India: Union Minister Hardeep Singh Puri

Union Minister Hardeep Puri Singh on Tuesday, reacted sharply to the BBC's admission of tax evasion. He also lambasted the Opposition parties over the latter's attack following the I-T surveys at BBC offices. Taking a jibe at Opposition leaders, he said some “intellectuals and misguided” people in the country start condemning them without knowing the facts. 

"We have people who are not able to differentiate between espionage and freedom of the press. Our laws are completely transparent and if you had to pay a tax, the slabs are completely clear. When notice is served to those avoiding taxes, they start hue and cry,” Puri told reporters.

While the Minister refrained from providing an elaborate comment on the BBC, he expressed that the broadcaster's past actions indicate it was in the "hands of people with an agenda on India".

BBC avoided paying taxes for years in India?

According to sources, the Income Tax Department's investigation has obtained evidence suggesting that tax has not been paid on certain remittances by the BBC. These remittances were not disclosed as income in India, indicating potential tax non-compliance by the broadcaster, sources said.

Tax officials suspected that the BBC has utilised the services of contractual employees, for which reimbursement was made by the Indian entity to the foreign entity, sources said. Such remittance was also liable to be subject to withholding tax which has not been done by the company. Additionally, the ongoing investigation conducted by I-T officials has uncovered several discrepancies and inconsistencies in relation to the Transfer Pricing documentation, as per the sources.