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India accuses Pernod Ricard of Scotch tax dodge
An investigation has concluded that Pernod India withheld the real composition and age of its Scotch whiskies in order to pay lower taxes in the market.
The French spirits company has a fight on its hands in India, where it is facing a number of simultaneous investigations into its practices in the market.
Earlier this month, db reported that Pernod Ricard’s Indian subsidiary is in the midst of a formal anti-trust investigation over allegations it secured exclusive retail arrangements in New Delhi to favour its brands. This comes on top of an ongoing probe into whether Pernod Ricard colluded with retailers to boost its market share in New Delhi, which it denies.
Befuddling customs
Now Indian authorities have concluded that Pernod India withheld the composition and true ages of Scotch whiskies sent to India by Chivas Brothers UK, according to a government filing made on 24 January 2026. As detailed by Reuters, an investigation found that the Chivas Regal maker did not declare “the true description of their imported malts with the intention to hide the actual value of the imported goods and to avoid comparison.”
It builds on previous allegations made in September 2025 that Pernod “intentionally complicated” information regarding its whisky imports to India, with the company apparently using “internal malt codenames” to make things more difficult for customs authorities when comparing Pernod’s imports with those of its rivals, documents show.
The spirits company, which also owns Jamesons and The Glenlivet, has been instructed to pay US$314 million in back taxes. This is because, India says, Pernod undervalued its bulk Scotch concentrate imports by 67.49%, slashing the historical 150% tariff that New Delhi imposed on Scotch imports to the country in 2007.
Pernod India issued a statement in response, saying it “rejects any suggestion of wrongdoing” and is “addressing this matter through the appropriate legal channels and remains confident in its position.”
The company argues that it was not given access to key pricing data used by investigators and that the findings are “grossly violative of the doctrine of natural justice.”
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Furthermore, Pernod said that during the price comparison assessment Indian officials “wrongly excluded” dozens of other companies that imported Scotch concentrates at lower prices, choosing to “selectively compare” Pernod to rival company India’s Allied Blenders and Distillers, whose import prices were higher.
Profits “went back to the holding company”
However, investigators determined that ”utmost attempts were made by the Pernod Ricard Group subsidiaries to keep their expenses towards customs duty disbursements to the minimum and generate maximum profits” for Pernod India.
According to documents included in the government filing, Pernod India funnelled profits earned by undervaluing its whisky into the “ultimate holding company” in France.
Tariffs to come down
Last year (July 2025), India vowed to reduce the 150% tariff to 40% over the next decade in a landmark free trade deal agreed between the UK and India, a move celebrated by leading Scotch producers.
At the time, Jean-Etienne Gourgues, CEO of Chivas Brothers, the Scotch whisky arm of Pernod Ricard, described the FTA as “a significant step forward for the Scotch whisky industry”.
“Once ratified by UK and Indian governments, this deal will unlock one of the world’s biggest whisky markets and enable us to open Chivas Brothers’ Scotch whiskies up to a wider range of Indian consumers seeking premium, world-class spirits,” he said.
The UK government estimates that the tariff cuts, coupled with wider regulatory improvements, will increase UK exports to India by nearly 60% in the long run — equivalent to £15.7 billion in additional trade by 2040
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