Microsoft Corporation (MSFT), The Walt Disney Company (DIS) and Koch Industries Named In LuxLeaks Scandal
The new document released by investigative journalists’ allegedly drags down over a dozen companies to have involved in tax scandal in Luxembourg. The companies included Microsoft Corporation (NASDAQ:MSFT), The Walt Disney Co (NYSE:DIS) and Koch Industries. These companies were charged with avoiding tax in the country by striking a secret deal.
Brokered Secret Deals
Report indicated that International Consortium of Investigative Journalists or ICIJ has obtained documents running into 28,000 pages. These documents were examined by a number of newspapers, and the first installment named hundreds of big companies of international stature. The revelation indicated that global companies brokered clandestine agreements with Luxembourg aimed at avoiding paying taxes running into billions of dollars.
Four international accounting firms such as Deloitte, Ernst & Young, KPMG, and PricewaterhouseCoopers have reportedly brokered tax structures for big companies between the periods 2003 and 2011 when Jean-Claude Juncker was the Prime Minister of Luxembourg.
The revelations came just before Juncker was set to take over the position of European Commission President. The disclosure might put pressure on Juncker over the tax policies pursued by him during his tenure.
The ICIJ appeared to have secured documents that indicated favorable treatment of tax-saving schemes by officials of Luxembourg. For instance, Skype, which is currently owned by Microsoft, had used the Irish subsidiary to enable its unit in Luxembourg to disclose no tax for a period of five years.
Apart from this, Koch Industries and Walt Disney reportedly had multifaceted deals to route profits of millions of dollars through Luxembourg between 2009 and 2013 by paying a small tax. Walt Disney was given a 0.28% tax rate as per the agreements.
Call For Transparency
Following the revelations of secret tax deals, the journalists’ body has called for a transparency in company ownership. The disclosure also put pressure on the political side to address the issue of tax avoidance in Luxembourg.
In an open letter, international journalists have also said that large companies were in a position to extract as much as they can from a country where no one could see.
Latest posts by Viraj Shah (see all)
- Facebook Inc (NASDAQ:FB)’s China Plans Will Come At A Price - December 6, 2016 05:55 AM PDT
- Trump Will Be Tested On Dakota Access Pipeline - December 6, 2016 03:46 AM PDT
- Fannie Mae (FNMA) and Freddie Mac (FMCC) Investors Are Watching Latest Developments Closely - November 30, 2016 06:22 AM PDT