The United States tax authorities are currently engaged in a significant dispute with Microsoft, claiming that the tech giant owes a substantial sum of $28.9 billion in taxes. Microsoft, however, vehemently disagrees with this assessment and intends to challenge the Internal Revenue Service (IRS), responsible for tax collection in the United States.
At the heart of this tax dispute lies a complex issue involving the pricing practices among various subsidiaries within the Microsoft group. As with many multinational corporations, Microsoft has established entities in numerous countries, allowing them to issue invoices to one another. These intra-company transactions have a significant impact on the taxable profits Microsoft reports both in the United States and in other nations.
Microsoft anticipates that this protracted battle with the tax authorities could extend over several years. The substantial tax liabilities and penalties, as asserted by the IRS, pertain to the period spanning from 2004 to 2013. Microsoft is keen to emphasize that its ongoing business operations remain unaffected by the ongoing tax audit, underscoring this point in a statement released on its official website.
About the author: John Campbell
John Campbell is the godfather of Polimedia and the oldest author from the whole team. His occasional guidance is crucial for everyone he advises.