U.S. Senate: Microsoft Used Tax Maneuvers To Avoid Billions In Taxes
According to a U.S. Senate committee in a memo, Microsoft has used aggressive international tax maneuvers to avoid paying billions of dollars in taxes over the last 3 years. The committee memo was released in advance of a 2PM hearing in Washington today.
Microsoft used transactions with subsidiaries in Ireland, Singapore, Puerto Rico, and Bermuda to save around $6.5 billion in taxes.
However Senator Carl Levin, a chairman of the Permanent Subcommittee on Investigations, did not Microsoft of acting illegally. “These loopholes and abuses exact a tremendous cost,” said Levin. “What these gimmicks do is shift the burden of taxes onto citizens and business who don’t use armies of lawyers and accountants.”
Levin sent the memo with Tom Coburn, a Republican of Oklahoma. Companies can move profits outside the country and keep them there to avoid paying taxes in the U.S. Microsoft and HP is scheduled to testify at a hearing today.
“Microsoft’s tax results follow from its business, which is fundamentally a global business that requires us to operate in foreign markets in order to compete and grow,” stated Microsoft corporate VP for worldwide tax Bill Sample. “In conducting our business at home and abroad, we abide by U.S. and foreign tax laws as written.”
This article was written by Amit Chowdhry. You can follow me at @amitchowdhry or on Google+ at +AmitChowdhry