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Google, Amazon & Apple are in hot waters with the IT Dept
This past month, Amazon, Apple and Google have faced scrutiny from Indian tax authorities.
They believe these companies are not abiding by an appropriate 'transfer pricing policy'.
Transfer Pricing simply means the price at which the company sells/transfers products to its other branches/subsidiaries.
Think of it like this: A company like Apple has subsidiaries or branches in high-tax and low-tax countries. By "selling" products cheaply to the low-tax branch, the high-tax branch shows less profit, paying less tax.
This is what alerted the income tax department. Reports suggest that the combined tax demand from these companies is ₹5000 Crores!
Saving in taxes is a great practice, as long as it's done ethically.
You too can save taxes by planning in advance with a tax expert! If you need help with planning your taxes, connect with a tax expert now.
Apple watch ban | Zara’s Controversial ad
Health tech company Masimo has claimed that Apple stole its blood oxygen sensor technology for its Series 9 and Watch Ultra 2.
Apple had to pull these two products from sale in the US with immediate effect.
"A small event can damage years of good reputation". That's what happened with ZARA.
ZARA’s ad campaign called “The Jacket” put the company in the darkest days it has ever seen.
ZARA faced protests globally as it was interpreted as insensitive to this ongoing middle east saga. ZARA had to pull the ad campaign and stated the company “regrets the misunderstanding”.
When you are a huge market player, everything that you do is taken on a serious note by your customers, your competitors and regulators.
Regulators stall Adobe's acquisition of Figma
In 2022, Figma crossed $400M in annual recurring revenue (ARR).
Figma is a design tool for building digital products where they’ve made it simple to collaborate and test. UI/UX designers love the tool.
It's giant competitor, Adobe was planning to merge with Figma.
Adobe came in with a fat cheque of $20B, which was a big deal for everyone in the industry!
However, regulators from UK and EU started launching probes into the merger. (Probes basically means starting an investigation)
Why?
The regulators’ job is to observe the market. A healthy market is where there’s competition.
In the case of Figma and Adobe, if they merge there’ll be no more rivalry in the market, basically monopoly!
Back in the day, when Jio came into the Indian Telecommunication Industry, existing players were negotiating mergers to stand strong. At that time several possible mergers were not feasible because of a similar issue.
That brings us to the end of this month's edition. We would love to know your feedback.
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