Danish government slaps $1 billion tax bill on Microsoft

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

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12 Comments

1. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Awww. I guess Steve won't be getting his bonus this year. Dang. I wonder who got scroogled this time?

2. networkdood

Posts: 6330; Member since: Mar 31, 2010

No surprise here, folks

3. PhoenixWright

Posts: 102; Member since: Feb 11, 2013

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

11. alila2

Posts: 169; Member since: Nov 01, 2011

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

4. SitiHardiyantiRukmanaBangsat

Posts: 3; Member since: Mar 05, 2013

Microsoft THE EVIL EMPIRE do the TAX EVASION and got CAUGHT PANTS DOWN Balmer.... Your OUT

9. RaKithAPeiRiZ

Posts: 1488; Member since: Dec 29, 2011

in a few hours Vikings will storm Seattle

5. TROLLING

Posts: 13; Member since: Feb 28, 2013

Good you deserve it. MS & Apple are the same. And that fat bald egg face.

6. alterecho

Posts: 1106; Member since: Feb 23, 2012

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

7. josephnero

Posts: 780; Member since: Nov 16, 2011

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

8. Neurone

Posts: 54; Member since: Mar 05, 2013

One billion! ?thats a big blow.

10. Dunknown

Posts: 84; Member since: Jul 23, 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.

13. tward291

Posts: 559; Member since: Feb 14, 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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