Latest Developments – Company Income Tax

 Business under threat from Uncle Sam as Wal-Mart Loses State Income Tax Appeal US businesses may choose to reorganize their corporate structures as a result of Wal-Mart losing a legal battle to reclaim USD33.5m in tax it paid to the state of North Carolina. Walmart appealed for the USD33.5m bill in back taxes, penalties and interest imposed by North Carolina, which had argued that rental payments made by the company to a Wal-Mart subsidiary were improper. However, the state Court of Appeals ruled on May 19 that the state Secretary of Revenue “acted within his lawful authority” when he assessed additional taxes against the company. “The language of the statute is broad, allowing the secretary to require combined reporting if he finds as a fact that a report by a corporation does not disclose the true earnings of the corporation on its business carried on in this state,” wrote Judge Donna Stroud in her opinion, which was supported by the two other judges on the panel. This may affect your business – do you need some advice about tax law? Ask the experts by entering a question into the box above.



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