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New 'LuxLeaks' release drags Disney, Microsoft into tax scandal

Wednesday, December 10, 2014 - 08:39
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Dozens of multinationals including Microsoft, Disney and Koch Industries were dragged into the Luxembourg tax avoidance "LuxLeaks" scandal on Tuesday with the release of new documents by investigative journalists.

[LONDON] Dozens of multinationals including Microsoft, Disney and Koch Industries were dragged into the Luxembourg tax avoidance "LuxLeaks" scandal on Tuesday with the release of new documents by investigative journalists.

The revelations increase pressure on former prime minister Jean-Claude Juncker over Luxembourg's tax policies during his 19 years in office, and come on the eve of his swearing-in as president of the European Commission.

The new claims emerge from 28,000 pages of documents obtained by the International Consortium of Investigative Journalists (ICIJ) and examined by dozens of newspapers.

The first installment in November revealed hundreds of the world's biggest companies brokered secret deals with Luxembourg to avoid paying billions of dollars in taxes.

The new documents detail "aggressive tax structures" brokered for major companies by accountants Ernst & Young, KPMG, PwC and Deloitte.

The reports claim internet calling business Skype, owned by Microsoft, used an Irish subsidiary to allow its Luxembourg unit to report no corporation tax over five years.

Entertainment giant the Walt Disney Company and Koch Industries had complex arrangements to channel "hundreds of millions of dollars in profits through Luxembourg" from 2009 to 2013 and pay little tax, the ICIJ said.

The "LuxLeaks" scandal has increased political pressure over tax avoidance, and last week the European parliament ordered reports into tax evasion and tax fraud.

Mr Juncker has defended his support for Luxembourg's deals with global firms, saying his country had no choice if it wanted to stay competitive.

The November leaks named hundreds of companies including Apple, Pepsi, IKEA and Heinz as beneficiaries of tax breaks during Mr Juncker's years in office.

AFP

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