India freezes TikTok parent ByteDance's bank accounts in fresh blow
Indian authorities have frozen the bank accounts of TikTok owner ByteDance on grounds of alleged tax evasion by the Chinese firm. ByteDance India is likely to take the matter to the Mumbai High Court, arguing that the decision is an abuse of the legal process and would make it hard to pay salaries and taxes, Reuters reported, citing sources. Here are the details.
Bank freeze likely linked to alleged tax evasion
Two of ByteDance India's bank accounts in Citibank and HSBC were directed to be blocked for alleged evasion of certain taxes in online advertising dealings between the ByteDance unit in India and its parent company in Singapore. Authorities also reportedly ordered Citibank and HSBC to bar ByteDance India from withdrawing funds from other bank accounts linked to its tax identification number.
ByteDance could struggle to pay salaries
The company has close to 1,300 employees in India who could potentially be affected, most of whom service its overseas operations. ByteDance had already let go of 1,000 employees earlier this year after the government's indefinite ban on its app made it unfeasible to maintain its entire workforce. Its business has reportedly come to a standstill as a result of the directive.
TikTok's troubles in India
To recall, TikTok was one of the first of more than 200 Chinese apps to be banned since diplomatic and economic tensions took a turn for the worse between Asia's two largest economies. The move to ban the apps in the country came after 20 Indian soldiers were martyred in a tussle between Indian and Chinese troops at Galwan Valley on the Indo-China border.
TikTok has faced worldwide scrutiny as security threat
In fact, ByteDance and other Chinese companies have come under the scanner world over and particularly during Donald Trump's stint as US President. However, with Democrat Joe Biden's election into the office, a government lawsuit to effectively ban TikTok's use in the US was put on hold. Recently, studies have suggested TikTok poses no greater threat than Facebook when it comes to data collection.
