Company: ZCARW
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014437
Chunk: 982

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Part I, Item 2
Chunk 982
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urrency-denominated costs, assets, and liabilities. In addition, any devaluation of the Rupee relative
to other foreign currencies could increase our operating expenses, adversely affecting the results of our operations. Any of these factors
could adversely affect our financial condition and the results of our operations in the future.

The effective tax rates governing car rental
and car subscription in India could change. 

The tax environment continues
to evolve in India on a routine basis and remains relatively fluid compared to other more mature markets. The indirect tax rates associated
with the Goods and Services Tax (GST) have changed on multiple occasions since the GST’s introduction in 2017. Any further increase
in these indirect tax rates could result in a reduction in the Company’s operating cash flow, which could impair our future profitability.

110

The Indian government could reduce highway
infrastructure investments, thereby making car travel significantly less appealing. 

The Indian government is
currently investing significantly in expanding the country’s underdeveloped network of interstate highways and expressways. Compared
to more mature markets, the Indian civil infrastructure is under-invested across its 28 states and 8 Union territories. The development
of new highways and expressways makes personal car transportation considerably more desirable, as new highway infrastructure could potentially
reduce travel time and overall traffic congestion. These new highways and expressways also have the potential to mitigate low-speed vehicle
intrusions on highways, which could potentially improve overall road safety. In the event that the Indian government slows down this investment
due to macroeconomic considerations, our business could observe a negative impact on overall customer demand, which could reduce our future
profitability.

We may have exposure to materially greater
than anticipated tax liabilities. 

The tax laws applicable to
our business activities are subject to uncertainty and can be varied in the relevant jurisdictions. Like many other multinational companies,
we are subject to tax in diverse jurisdictions and have structured our business to reduce our effective tax rate. The taxing authorities
of the jurisdictions in which we operate have in the past, and may in the future, examine or challenge our methodologies for valuing developed
technology, which could increase our worldwide effective tax rate and harm our financial position and operating results. Furthermore,
our future income taxes could be adversely affected by earnings being lower than anticipated in jurisdictions that have lower statutory
tax rates and higher than anticipated in jurisdictions that have higher statutory tax rates, changes in the valuation of our deferred
tax assets and liabilities, or changes in tax laws, regulations, or accounting principles