Pernod Ricard faces alleged $314 million tax shortfall in India
French liquor giant Pernod Ricard is in hot water with Indian authorities, who say the company undervalued Scotch whisky imports to dodge hefty customs duties.
Officials claim Pernod hid details like age and blend to lower the declared value of Scotch concentrates, key ingredients in popular brands like Royal Stag, which are taxed at a steep 150% rate.
The alleged tax shortfall? Nearly $314 million, according to reports.
Investigators allege 67.5% undervaluation, Pernod denies
Investigators say Pernod used codenames like "RFM" (Rich Fruity Malt) and "HMW" (Heavy Malt Whisky) since 2011 to make shipments harder to track, possibly undervaluing them by nearly 67.5%.
Pernod, for its part, insists it follows Indian laws and is fighting back legally, calling out what it sees as unfair comparisons with competitors.
If found guilty, the company could face penalties that could potentially push the total exposure beyond $600 million, a sign that India is getting serious about cracking down on big companies skirting import rules.