A study suggests that Microsoft is avoiding taxes in many countries

First change: 10/13/2022 – 15:38Last change: 10/13/2022 – 15:36

“In many cases, Microsoft has paid no tax in recent years while shifting profits to companies resident for tax purposes in Bermuda and other tax havens,” the Center for International Corporate Tax Responsibility and Intelligence (CICTAR), a research firm, condemned. A report based in Australia.

“Microsoft boasts of delivering profit margins of more than 30% to its shareholders. However, in the United Kingdom, Australia and New Zealand, (the company) reported returns of 3 to 4%,” Jason Ward, a Cabinet analyst, was quoted as saying in the report.

“It doesn’t seem plausible that these prosperous markets have such weak returns,” he added, and sees “a big warning signal” of tax evasion that “deprives the public sector of much-needed revenue” despite making “thousands of millions” of a supplier to the governments of those countries.

Microsoft Global Finance, an Irish subsidiary with tax residency status in Bermuda, focused more than $100 billion in investments and failed to pay taxes in 2020 despite an operating profit of $2.4 billion, according to the study.

In another example cited by CICTAR, Microsoft Singapore Holdings posted its 2020 profit of $22.4 billion from dividends, but reported a tax burden of just $15.

However, over the past five years, Microsoft has signed public contracts worth at least $3.3 billion in the United Kingdom, the United States, Australia or Canada, according to data from the study.

The cabinet points out that Microsoft is under investigation by tax services in the United States and other countries, including Australia, and that “more than 80% of its total foreign income is routed through Puerto Rico and Ireland.”

“For fiscal years 2021 and 2020, our overseas regional operating centers in Ireland and Puerto Rico, which are taxed at a lower rate than the United States, generated 82% and 86% of our overseas income before taxes,” Microsoft said in a statement. 2021 Annual Report.

Contacted by the report’s authors, Microsoft pledged to respect “all local laws and regulations” in countries where it operates.

© 2022 AFP