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Microsoft Pri0

Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times technology reporter Matt Day.

Topic: taxes

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November 26, 2014 at 11:03 AM

China charges Microsoft $137 million in back taxes

Microsoft’s testy relationship with China just got a bit tougher.

The Chinese government has levied $137 million in back taxes and interest against the company, according to a report by China’s Xinhua state news service.

The report doesn’t identify Microsoft by name, labeling the target of the fine as “M,” described as a world-renowned U.S.-based company that started its Chinese subsidiary in 1995. Microsoft launched Microsoft (China) Co Ltd. in Beijing in 1995.

Xinhua’s report said that the company’s Chinese unit was losing money on paper, even as the Chinese subsidiaries of other firms in the industry were profitable. The investigation, Xinhua said, found the company was shipping its profits overseas in avoidance of domestic taxes.

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November 24, 2014 at 1:40 PM

Microsoft sues IRS for details of tax probe contract

Microsoft is suing the Internal Revenue Service in an effort to get details of an agreement between the tax regulator and a law firm examining how Microsoft tallied its sales between subsidiaries.

The underlying tax matter is a big one for Microsoft. At issue is the IRS’s look at “transfer pricing,” or how companies charge for goods and services bought and sold between a company and its international subsidiaries.

Microsoft says the IRS is looking over the company’s income tax returns for its fiscal years 2004 through 2009. The IRS in May entered into a $2.1 million contract with law firm Quinn Emanuel Urquhart & Sullivan to provide services related to the tax audit, Microsoft said in a lawsuit filed in federal court in Washington, D.C. Quinn Emanuel says it specializes in business litigation and arbitration.

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September 25, 2013 at 5:11 PM

Coalition of small businesses urge Microsoft to end its offshore tax dodging

Hundreds of small business owners are urging Microsoft to end its practice of avoiding certain U.S. taxes by keeping much of its cash hoard overseas.

About a half-dozen members of Main Street Alliance, a network of state-based small-business coalitions, went to Microsoft headquarters in Redmond today to deliver an open letter signed by more than 200 local small business owners.

The letter urged Microsoft to “reverse course and join us in calling for an end [to] offshore tax dodging in order to make economy-boosting investments in the U.S.”

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