A U.S. Senate committee memo said Microsoft Corp. (MSFT)
used aggressive international tax maneuvers to avoid billions of dollars in
taxes over the past three years. According
to Bloomberg’s Best the report, released in advance of a 2 p.m. hearing in
Washington today, said Microsoft used transactions with subsidiaries in Puerto
Rico, Ireland, Singapore and Bermuda to save at least $6.5 billion in taxes. In
2008, Hewlett-Packard Co. (HP) created a series of short-term internal loans
that allowed the company to tap its offshore cash for domestic operations
without paying taxes, according to the report.
Senator Carl Levin, a Michigan Democrat and chairman of the
Permanent Subcommittee on Investigations, didn’t accuse the companies of acting
illegally.
“These loopholes and abuses exact a tremendous cost,” Levin
told reporters at a briefing today. “What these gimmicks do is shift the burden
of taxes onto citizens and business who don’t use armies of lawyers and
accountants.”
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