U.S. Senate panel to grill Caterpillar executives at tax hearing
WASHINGTON, April 1
WASHINGTON, April 1 (Reuters) - Executives for Caterpillar Inc will defend the company's offshore tax strategies at a U.S. Senate hearing on Tuesday held by a panel known for shedding light on corporate tax avoidance.
In a 99-page report released on Monday, the Senate the Permanent Subcommittee on Investigations said Caterpillar avoided paying $2.4 billion in U.S. taxes from 2000 through 2012 by moving profits from sales of replacement parts through a low-tax unit it set up in Switzerland.
Democrat Senator Carl Levin, chairman of the subcommittee and one of Capitol Hill's most dogged questioners, said on Monday Caterpillar set up the Swiss structure for no other reason than to avoid U.S. taxes.
Caterpillar, the world's largest mining and construction equipment maker, said on Monday the Swiss structure is legal and is a standard business move for many multinational companies.
"Caterpillar stands by this structure," said Julie Lagacy, vice president of Caterpillar's finance services division, according to prepared testimony released ahead of the hearing.
Along with three Caterpillar executives, representatives of Big Four accounting firm PricewaterhouseCoopers LLP, which advised Caterpillar on the restructuring, are expected to testify.
"In the fantasy land that is international tax law, tax lawyers waved a magic wand to make millions of dollars in the U.S. taxes disappear," Levin said.
Levin's panel has previously held hearings on corporate tax avoidance with executives from Apple Inc, Hewlett-Packard Co and Microsoft Corp.
(Reporting by Patrick Temple-West; Editing by Lisa Shumaker)
- Tweet this
- Share this
- Digg this
- One dead, one wounded in shooting in Chicago financial district
- Israel, Palestinians locked in vicious circle of Gaza wars
- UPDATE 2-Bombardier plans more job cuts, Russia plans intact
- UPDATE 1-EU adopts toughest Russian sanctions yet, targets 5 Russian banks
- CORRECTED-UPDATE 2-GE credit card unit Synchrony makes muted debut on NYSE