Big Profits, Tiny Taxes || Part 5
Originally published Dec. 4, 2019
Six years ago, the world’s largest beer company sold off its stake in a business that distributed Corona and other Mexican beers in the United States, including in Florida.
Anheuser-Busch InBev SA made nearly $2 billion on that sale — and then said Florida couldn’t tax any of it, cutting its state corporate income tax bill by more than $5 million, according to litigation records.
To get those tax savings, Anheuser-Busch used a vague section of the tax code that’s supposed to deal with profits companies earn outside of their normal course of business.
The Bud Light brewer is not alone. Businesses from department store retailer J.C. Penney to hospital operator HCA have seized on the same imprecise part of the law to shield big chunks of income from Florida income taxes, according to litigation records.
“Nobody knows exactly what the standard is, so it’s a gray area,” said Jim Ervin, a tax attorney in the Tallahassee office of Holland & Knight.
Economists estimate that Florida loses nearly $50 million a year to companies claiming these kinds of deductions for irregular profits. That’s more than the state is spending this year to preserve environmentally sensitive land through the “Florida Forever” land-buying program.
Read the rest of the story here.
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