UK drug company GlaxoSmithKline is battling the U.S. Internal Revenue Service over a potential $1.9 billion in back taxes, interest and penalties, according to The Wall Street Journal.
The IRS is investigating a tax-savings technique at Glaxo known as "earnings stripping," the WSJ reported. The practice, which involves claiming interest deductions for payments to units abroad that in fact never leave the parent company, is popular among foreign companies with large U.S. operations, the newspaper said.
Reuters
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