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Danish government slaps $1 billion tax bill on Microsoft

Posted: , by Maxwell R.

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Danish government slaps $1 billion tax bill on Microsoft
This could end up being the largest tax case in Denmark’s history. The whole deal revolves around actions that Microsoft took when it purchased the accountancy software firm Navision in 2002.

Those actions, on the face of it, wove a rather complex web through transactions, technically legal, that allowed Microsoft to pay little-to-no taxes on about $11 billion in revenue. If the process is followed correctly, there are ways to get around Denmark’s high taxes. However, the Danish authorities believe Microsoft did some things procedurally wrong and further believe that their investigation reveals such wrongdoing. The result is the Danes sent Microsoft a 5.6 billion Danish kroner ($980 million) tax bill to Steve Ballmer.

After buying Navision, Microsoft sold the rights to Navision’s software code to an Irish subsidiary. That Irish subsidiary is owned through holding companies in the Virgin Islands and Bermuda. That enabled Microsoft to funnel revenues out of Denmark without paying taxes. However, the Danes believe that the sale to the Irish company was below market value, and so the bill represents lost tax revenues plus interest.

There has not been any official statement by Microsoft, but word has it that the company disputes Denmark’s timeline of events. When such transactions are made, it is common for third-party companies to be involved to assess fair market value for “intangible” technology like software code.

Whether or not Microsoft will pay up for fight the bill remains to be seen.

source: The Register

13 Comments
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posted on 04 Mar 2013, 22:31 21

1. Droid_X_Doug (Posts: 5578; Member since: 22 Dec 2010)


Awww. I guess Steve won't be getting his bonus this year. Dang.

I wonder who got scroogled this time?

posted on 04 Mar 2013, 22:32 9

2. networkdood (Posts: 6260; Member since: 31 Mar 2010)


No surprise here, folks

posted on 04 Mar 2013, 22:49 1

3. PhoenixWright (Posts: 99; Member since: 11 Feb 2013)


Wonder what they'll do with the 1 Billion?
Maybe they'll buy some rotten Apples :D

posted on 05 Mar 2013, 08:07

11. alila2 (Posts: 118; Member since: 01 Nov 2011)


500 million for tax violation and the other 500 , because that dude never ever take a normal looking photo .

posted on 05 Mar 2013, 09:01

12. Bernoulli (Posts: 1436; Member since: 01 Sep 2012)


The King will just buy himself a new Island

posted on 05 Mar 2013, 00:36 2

4. SitiHardiyantiRukmanaBangsat (Posts: 3; Member since: 05 Mar 2013)


Microsoft THE EVIL EMPIRE do the TAX EVASION
and got CAUGHT PANTS DOWN

Balmer.... Your OUT

posted on 05 Mar 2013, 04:49

9. RaKithAPeiRiZ (Posts: 1309; Member since: 29 Dec 2011)


in a few hours Vikings will storm Seattle

posted on 05 Mar 2013, 00:59 2

5. TROLLING (banned) (Posts: 13; Member since: 28 Feb 2013)


Good you deserve it. MS & Apple are the same.

And that fat bald egg face.

posted on 05 Mar 2013, 02:33 3

6. alterecho (Posts: 1072; Member since: 23 Feb 2012)


Don't stoop soo low to make bad comments on someone's appearance, whether you like him or not, good or evil.

posted on 05 Mar 2013, 02:52

7. josephnero (Posts: 289; Member since: 16 Nov 2011)


but its okay for ballmar to talk s**t?

posted on 05 Mar 2013, 04:18

8. Neurone (Posts: 54; Member since: 05 Mar 2013)


One billion! ?thats a big blow.

posted on 05 Mar 2013, 07:44 1

10. Dunknown (Posts: 80; Member since: 23 Jul 2012)


What is wrong with that Danish Government. I'm sure everyone is using Microsoft Windows, Office, Xbox and etc. If one day Microsoft falls, there will be no more Windows, Microsoft office for the business men and this lead to global economy recession again. I remember the last time I read an article it stated that Microsoft was a monopoly company and has been in the court later it still lead with 90 per cent more or less of the global market computer OS.

posted on 05 Mar 2013, 13:06

13. tward291 (Posts: 559; Member since: 14 Feb 2012)


this makes no sense the purchase was 1.2 billion so there saying they want more tax from that purchase which equals a billion bulls**t lol. these European countries are flat broke so there scrambling to get more money if you think this ends with ms your just stupid, next it will be google and apple,

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