Transport Topics Online
The Newspaper of Trucking and Freight Transportation
Welcome  Guest  Log In         
4/1/2014 10:15:00 AM Write a Letter to the Editor Write a letter to the Editor

Caterpillar Avoided $2.4 Billion Tax With Swiss Subsidiary, Senate Probe Finds


Daniel Acker/Bloomberg News

Caterpillar Inc. avoided paying $2.4 billion in U.S. taxes by shifting profits from a parts business to a subsidiary in Switzerland, according to a report released by a Senate investigative committee.

The world’s largest maker of construction and mining equipment made a “paper change” starting in 1999 that made the profits of the subsidiary subject to a Swiss tax rate as low as 4%, said Sen. Carl Levin (D-Mich.), who will question company executives at an April 1 hearing.

“Nothing changed in the real world after that except Caterpillar’s tax bill,” Levin told reporters March 31. “Caterpillar waved a magic wand to make billions of dollars in U.S. taxes disappear.”

The report makes the point that offshore profit-shifting by U.S. corporations goes beyond the intellectual property maneuvers of technology companies such as Apple Inc. and Microsoft Corp. that have been the subjects of past hearings by Levin and scrutiny from governments in Europe.

According to the report, Caterpillar was able to take a profitable U.S.-based business, change little if anything about its operations and locate it in Switzerland for tax purposes.

The tax structure saves Caterpillar, which is based in Peoria, Ill., about $300 million a year, or 7.9% of 2013 net income.

By Bloomberg News

Follow Transport Topics on Subscribe to get up to the minute news briefs and more from our feeds. RSS Twitter Twitter Facebook Facebook

© 2014, Transport Topics Publishing Group. All rights reserved.


  RELATED ARTICLES

 
LATEST NEWS



 
LATEST JOBS
Follow Us

Newsletters

TTExpress
This free daily newsletter delivers the latest headlines.

TT Executive Suite
This subscriber-only newsletter program tailors your news.

Services

Advertising




© American Trucking Associations, Inc., All Rights Reserved TTNews.com Privacy Statement