India's tax authority says that Microsoft originally wanted to buy a stake in Nokia
In India, prosecutors have Nokia in court over a large tax bill that amounts to INR 21,153 crore (a crore is a unit of 10 million). The figure, which was calculated by the director general of income tax and the chief commissioner of income tax, is at issue in India's Tax Court. According to the Indian Tax Authority, Microsoft's original deal with Nokia was designed with the Redmond based software giant taking a stake in the Finnish handset manufacturer and the deal's final evolution, which ended with Microsoft buying Nokia's Devices and Services business, is a "convenient coincidence and is an internal collusive agreement".
The original tax case came from the result of seven years of payments from Nokia India Private Limited to Nokia Corporation without any taxes withheld by the Indian company. As far fetched as it seems, the Tax Authority in India is claiming that Microsoft and Nokia revised the deal from an equity investment to an outright purchase of assets to help Nokia paying avoid Indian taxes. That does seem a little hard to swallow, but read the statement below and you can come to your own conclusion.
The Financial Express newspaper in India noted that "The ACIT (India's Tax Authority) has also drawn attention to the fact that the Microsoft-Nokia agreement has undergone two amendments without there being any independent valuation of assets by a third party."
source: FinanacialExpress via NokiaPowerUser, WMPoweruser
The original tax case came from the result of seven years of payments from Nokia India Private Limited to Nokia Corporation without any taxes withheld by the Indian company. As far fetched as it seems, the Tax Authority in India is claiming that Microsoft and Nokia revised the deal from an equity investment to an outright purchase of assets to help Nokia paying avoid Indian taxes. That does seem a little hard to swallow, but read the statement below and you can come to your own conclusion.
"The decision of Microsoft Corporation to not purchase equity shares of Nokia Corporation and to purchase its assets only which are already attached by the department is a convenient coincidence and is an internal collusive agreement"-India's Tax Authority
The Financial Express newspaper in India noted that "The ACIT (India's Tax Authority) has also drawn attention to the fact that the Microsoft-Nokia agreement has undergone two amendments without there being any independent valuation of assets by a third party."
source: FinanacialExpress via NokiaPowerUser, WMPoweruser
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