Coca-Cola, the world’s leading producer of soft beverages, is suspected of tax evasion, causing the company to face a potential $3.3 billion tax bill.
Coca-Cola is said to have been underreporting its profits from 2007 to 2009. The US Internal Revenue Service (IRS) claims that the corporation could owe a hefty fine in the form of an additional federal income tax liability.
In its turn, Coca-Cola says that the amounts in question are mainly related to the dispute over foreign transfer pricing. The companies located in the United States are obliged to report their non-taxable income in compliance with the licensing agreement over intangible assets in subsidiary foreign companies.
The management of Coca-Cola firmly believes that this disagreement cannot possibly have any significant impact on the company’s results on the ground of financial performance statements over the reporting period.
Moreover, the soft drinks giant claims that it regularly assesses its tax reserves in case any such disputes arise.
The Coca-Cola company was established in the late 19th century. Today, its representative offices are located in 200 countries worldwide.
