Coca-Cola Co. said Friday it will pay $6 billion in back taxes and interest to the IRS while it appeals the federal tax court’s final ruling in a case that dates back 17 years.
O Atlanta beverage giant said it will continue to fight and believes it will win the legal dispute arising from taxes and interest that the IRS maintains the company owes since 2007, 2008 and 2009.
“The company looks forward to the opportunity to begin the appeal process and, as part of that process, will pay the agreed liability and interest,” it said in a statement. Coca-Cola spokesman Scott Leith declined further comment to The Associated Press.
U.S. Tax Court Judge Albert Lauber on Friday issued a two-sentence ruling and order ending his review of the case. The dispute reached court in December 2015, shortly after the company said it notified the IRS that owed US$3.3 billion more in federal taxes and interest in those three years.
In its Friday statement, Coca-Cola accused the IRS of changing the way it allows the company to calculate U.S. income based on profits worth more than $9 billion from foreign licensees and affiliates.
An IRS spokesperson did not immediately respond Friday to a phone message from the AP about the case.
In a filing with the Securities and Exchange Commission in 2015, Coca-Cola said it had been following the same method to calculate its U.S. taxable income from foreign affiliates for nearly 30 years.
In company quarterly report filed with the SEC on Monday, which included investor guidance, the company said it believes the IRS and Lauber “misinterpreted and misapplied applicable regulations in the reallocation of income earned by the company’s foreign licensees.”
The publicly traded company said it expects “some or all (of the $6 billion), plus accrued interest, to be repaid” if Coca-Cola wins its appeal. You have 90 days to file appeal documents.
Last week, the company raised its full-year sales guidance after reporting a second quarter stronger than expecteddriven by product price increases.
