Stars and Their Cars Targeted in Bollywood Tax Crackdown

Tax authorities have impounded the luxury cars of top Bollywood stars in a crackdown on ostentatious wealth that has seen the rich and famous scurrying for cover in the country's cities.

This weekend Sanjay Dutt, known for his street-tough roles, saw his Porsche towed away by the authorities. Earlier Suniel Shetty, a pumped-up actor, was charged with non-payment of duty on his Hummer, the civilian version of the Humvee, used by the US military. Mr Shetty says he paid 7m rupees (£95,000) for the car. The government has seized 45 such vehicles, including top-end Toyota Prados, LandCruisers, BMWs and Jaguars.

It is not just wealthy actors who have been caught in the net. The son of a prominent communist leader had to hand over the keys of two of his SUVs. Many are exclusive marques, costing more than £150,000, as India levies a 100% luxury tax on high-end motor vehicles not made in the country.

Tax officials, however, say they have uncovered a ring of dealers who have evaded these charges by using a loophole designed to promote the tourist industry. Tour operators are exempted because they need luxury cars to cater for foreign tourists. It appears some wealthy Indians are paying travel agencies to import the luxury cars they want; the ownership of the vehicle is changed later.

Motor manufacturers are increasingly eyeing the Indian market. In recent months Rolls-Royce has opened a dealership and BMW has announced plans for a plant in Tamil Nadu. Last year a chewing tobacco baron paid £600,000 for a German-made Maybach for his daughter.