The country’s tax authority said P&G has over-billed $138m in imports in order to take money out of Argentina
Argentina has accused Procter & Gamble of tax fraud and has suspended the company's operations in the country.
The country’s tax authority said P&G has over-billed $138m in imports in order to take money out of Argentina. “The Federal Administration of Public Revenue (AFIP) suspended the multinational Procter & Gamble for tax fraud related to import transactions from Brazil that were billed through a subsidiary based in Switzerland for $138m,” said Argentina’s Secretaría de Communición Pública. The alleged fraud involves shipments of razors and other hygiene products.
AFIP added that details of the alleged fraud have been sent to the Securities and Exchange Commission. “We must end this trickery of global enterprises involving harmful tax planning in foreign trade,” said Ricardo Echegaray of the AFIP. “Global enterprises can not manage their earnings by deceiving the state, evading taxes and leaking currency – this misconduct prevents the development of the nation, depriving citizens of resources for public services, health, education, justice, transportation, retirement and other social investments.”
P&G denies any wrongdoing. “We don't pursue aggressive tax/fiscal planning practices as they simply don't produce sustainable results,” said the firm’s spokesman, Paul Fox The firm has been operating in Argentina since 1991, where it runs three manufacturing plants and two distribution centres.
P&G owns brands including Olay, Gucci, Wella, Herbal Essences and Head & Shoulders.