Microsoft Korea fined for tax evasion
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Microsoft Korea paid back taxes and penalties for tax evasion to the tune of US$27 million and is disputing a further US$32 million payment to the South Korean National Tax Service. In March, Microsoft Korea admitted that it had evaded taxes in Korea between 1997 and 2001. The Korean subsidiary was charged with inflating expenses by overstating the cost of software imported from its U.S. parent company, thus underreporting its income.
Microsoft Korea is disputing the remaining balance of the initial US$59 million tax assessment, saying that the allegation arose from a difference of opinion between the company and the tax authorities over the way imported software products are priced.
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