Tag: Caterpillar

US Senate Committee request records related to tax schemes involving Caterpillar and Renaissance Technologies

US Senate Committee request records related to tax schemes involving Caterpillar and Renaissance Technologies

In a letter dated 28. April 2021 the US Senate Committee on Finance has request records related to tax schemes involving Caterpillar and Renaissance Technologies. “In 2015, Caterpillar disclosed that a federal grand jury in Illinois had begun investigating an alleged tax scheme involving the company’s Swiss subsidiary. This investigation led to raids by federal agents on three different Caterpillar offices in March 2017. 4 Days after the raids, Caterpillar announced it retained Mr. Barr “to take a fresh look at Caterpillar’s disputes with the government, get all the facts, and then help us bring these matters to proper resolution based on the merits.” Since January 2018, the IRS has sought to recover $2.3 billion in unpaid taxes and penalties from Caterpillar in connection with the alleged tax practices. Alarmingly, just six days after Mr. Barr was nominated to serve as Attorney General, an inspector general agent at the U.S. Federal Deposit Insurance Corporation was reportedly instructed by the DOJ ... Read more
France vs. Caterpillar, October 1989, CE No 65009

France vs. Caterpillar, October 1989, CE No 65009

In Caterpillar, a 5% royalty was found to be an arm’s-length rate for the manufacturing and assembling operations. The court did not accept that there should be different rates for the two different activities. Excerpt from the Judgement “…According to the administration, the rate of the royalty paid by the company “Caterpillar France” is admissible only when it applies to the selling price of equipment entirely manufactured by the company, but not when it affects the gross margin made on equipment that the company has only assembled, since the assembly operations make less use of the technology and know-how acquired by the American company than the machining operations themselves; that, however, the details provided and the documents produced in this respect by the company do not make it possible to make such a distinction between the operations that successively contribute to the production of the finished products; that the uniform rate of the fee cannot, in the circumstances of the ... Read more