The Internal Revenue Service (IRS), the US tax authority, asked a ecosystem di pay around 29 billion of dollars (28,9 billion to be exact) in unpaid taxes, plus interest and penalties. The Redmond company itself announced it through a note on his site.
Le disputed taxes to Microsoft come from an in-depth investigation conducted by the IRS into how the company allocated its profits across different countries and jurisdictions during the period 2004-2013.
Cost sharing controversy
The controversy mainly concerns the profit allocation method by Microsoft between various countries and jurisdictions during a given period. This aspect is known as “transfer pricing” (transfer price), and the IRS has established rules that allow companies to use a specific approach called “cost-sharing” (cost sharing).
Many large multinational companies adopt cost sharing as it reflects the global nature of their businesses. According to critics of this practice, transfer pricing is used by companies to minimize taxes by reporting lower profits in high-tax countries and higher profits in low-tax jurisdictions.
Microsoft doesn't agree: "we will appeal"
Microsoft claims to have complied with IRS rules and has already stated that will appeal against the decision of the US Tax Office.
"Microsoft disagrees with these proposed fixes and will initiate an appeal within the IRS, a process that is expected to last several years. We believe we have always complied with IRS rules and have paid taxes due in the United States and around the world. Historically, Microsoft has been one of the largest contributors of corporate revenue in the United States. Since 2004, we have paid more than $67 billion in taxes in the United States,” the company said in a statement.
“We firmly believe have acted in accordance with the rules and IRS regulations and that our position is supported by case law. We welcome the conclusion of the IRS review, which will provide us with the opportunity to address these issues in the IRS Appeals Office, a separate division of the IRS charged with resolving tax disputes,” the statement concludes. .
Furthermore, according to the Redmond company, taxes paid under the Tax Cuts and Jobs Act (TCJA) are not considered in the corrections proposed by the IRS, which could lead to reduce the final tax due as part of the audit up to 10 billion of dollars.
Big Tech and unpaid taxes to governments
The taxes paid by American Big Tech companies, such as Apple, Amazon and Microsoft, are the subject of discussions in governments around the world. Companies are accused of shifting their profits to countries with low or no taxes in order to avoid taxes in their main markets and maximize profits.
The XNUMX-XNUMX business days, in 2016, asked to Apple di pay 13 billion euros in back taxes in 2016, but lost his appeal in 2020, and is still awaiting a new trial.
This year, Meta was investigated by the Milan prosecutor's office for failure to pay VAT for approximately 870 million euros.
Minimum Tax in Europe starting from 2024
The European Union is implementing a minimum tax on multinationals, mainly aimed at large tech companies, similar to the OECD Global Minimum Tax, which will be adopted by all European states by 2024. This tax will impose the obligation that no multinational group can pay less than 15% tax on income generated in the European Union. The tax will be paid by the parent company or its intermediary.
To be subject to this tax, multinationals must have a global turnover of at least 750 million euros achieved at least twice in the previous four years.
