Apple is lobbying the Indian government to amend an income tax law that could expose the company to billions in additional taxes over equipment ownership, according to sources familiar with the matter. The U.S. tech giant seeks to ensure it is not taxed for owning high-end iPhone assembly machinery used by its contract manufacturers, such as Foxconn and Tata, as it ramps up production in India.
The push comes as Apple expands its footprint beyond China, where it traditionally owns production equipment but faces no tax liability. Under India’s 1961 Income Tax Act, however, such ownership would create a “business connection,” potentially subjecting Apple’s global iPhone profits to Indian taxes.
Executives have held discussions with Indian officials in recent months to seek changes to the law, warning that current regulations could stall future growth. “If the legacy law is changed, it will become easy for Apple to expand … India can become more competitive globally,” one industry source said.
India’s government is cautiously reviewing Apple’s request, balancing its need for foreign investment with the protection of its taxation rights. A senior official said talks are ongoing, calling it “a tough call,” but added that India “needs investments” and aims to find a workable solution.
Analysts note that specialized iPhone assembly equipment can cost billions of dollars — far beyond what local manufacturers can finance — underscoring the urgency of Apple’s appeal. The lobbying highlights the stakes as India seeks to position itself as a global smartphone manufacturing hub while maintaining fiscal sovereignty.
