Karnataka gram panchayats slap notices on Foxconn for tax dues, threaten to seize assets

Taiwanese contract manufacturer Foxconn’s Karnataka unit has been slapped with notices by two gram panchayats for local tax dues, leaving the state government in a spot as the development comes amid its efforts to woo foreign investment in high-end electronics manufacturing.

One of the notices threatens to seize moveable properties from Foxconn premises, equal in value to the dues.

The 300-acre Foxconn facility in Devanahalli near Bengaluru international airport comes under the Vishwanathapura and Koira gram panchayats. While Koira gram panchayat has issued a seizure notice of Rs 12 lakh, the one from Vishwanathapura seeks details of structures being built, sanctioned plans, extent of vacant land etc., to determine the taxes.


Gram panchayats come under the rural development and panchayat raj department led by Priyank Kharge, who’s also the IT/BT minister.

The Taiwanese electronics giant makes smartphones for Apple and other companies at this plant. It has pledged to invest Rs 22,000 crore in phases to create a facility to assemble 20 million smartphones a year.

The state industry department has said it will take up the matter with the panchayat raj department and resolve the issue at the earliest.

Principal secretary (commerce and industries) S Selvakumar told ET that the panchayat’s action was due to a lack of understanding of the law. The Foxconn unit is part of the Devanahalli industrial area developed by the Karnataka Industrial Areas Development Board (KIADB). It is notified as a special investment region per the Karnataka Special Investment Region Act, 2022, and managed by KIADB.

“The companies pay their taxes to the KIADB, which uses 70% of it to develop the industrial area and transfers 30% to the gram panchayats concerned. We are taking it up with the panchayat raj department and will clarify on this,” Selvakumar said.

Panchayat raj department officials told ET that Foxconn must respond to the notices, else be prepared to pay the taxes or face action. They said that if the company does not respond, the gram panchayat has the authority to seize moveable property and auction them to recover their dues.

Foxconn was expected to create 500,000 jobs in the state over five years, Karnataka chief secretary Shalini Rajneesh had said last October.

In May 2025, the state government announced it was releasing incentives worth Rs 6,970 crore to the company under Karnataka’s electronics system design and manufacturing policy. Foxconn is the first electronics company to get such a large amount as incentives from the state, as Karnataka seeks to bolster its presence in high-end electronics manufacturing.