Nokia files complaint over India tax raid

Finnish phonemaker Nokia has filed a letter of complaint to Indian tax authorities, a month after the tax raid of its Chennai factory.

According to a a Wall Street Journal report Tuesday, Nokia said the tax raid was not only "counter to the domestic laws of India and international standards" but also "excessive, unacceptable and inconsistent with Indian standards of fair play and governance".

The phonemaker added India's tax authorities had not stated the reason for the tax raid. It said the company was in compliance with Indian laws as well as the bilaterally negotiated Finnish and Indian tax treaty.

Nokia said its transfer pricing policies were "fully in accordance with applicable legislation in India and Finland".

According to media reports, unnamed tax officials said the raid appeared to be related to tax due on payments which Nokia India made for software supplied by its parent company for devices manufactured in India. Reports pointed to allegations of tax evasion of about US$545 million.

A week following the raid, the Finnish government sent its Minister for Communications Krista Kiuru to India to discuss with her local counterpart, Kapil Sibal, on ways to resolve the issue.