WASHINGTON (WLFI) – Caterpillar Incorporated is at the center of a U.S. Senate hearing on taxes.
Lawmakers accuse the company of using a tax strategy to avoid paying $2.4 billion dollars in U.S. taxes. During Tuesday’s hearing, Sen. Carl Levin of Michigan said Caterpillar avoided those taxes by shifting profits to an affiliate in Switzerland, even though no employees or business activities were moved there.
A report by the Senate investigations subcommittee does not say Caterpillar broke the law. Levin says the tax strategy is not tolerable.
Caterpillar says it complies with all tax laws and pays what it owes. The company says that is an effective income tax rate of 29 percent.