Intel appeals against $2.4bn tax bill

Intel may be forced to
pay $2.9bn of tax on export sales after a near four year- fight with the
Internal Revenue Service.

The US taxman first clamped down on the electronic chip giant in August
2003, when it announced the adjustment to the levy on Intel’s export sales, but
the company may have to make payments for a seven-year period. 

The company’s federal income tax between 1999 and 2005 would increase by
about $2.2bn plus interest if it loses its appeal against the IRS, the company
said in its annual report filed at the
Securities and Exchange

The IRS would also likely make a similar claim for 2006, potentially
increasing Intel’s tax due by about $200m plus interest, if it fails to have the
ruling overturned.

The corporate, which reported fourth-quarter revenues of $9.7bn, believed
that there was a ‘possibility of a material adverse impact on the results of
operations’ for the period when the matter is resolved, but added that
management does not believe the outcome will affect its financial position, cash
flow or results of operations.’

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