Aug 8 Auto parts supplier Delphi Automotive Plc
said it would "vigorously contest" pressure by U.S. tax
authorities to file taxes in the United States as a domestic
company, when its tax base is in the UK.
The Internal Revenue Service told Delphi in June that it
would be taxed as a U.S. company due to the sale of its assets
to Delphi Holdings LLC after it emerged from bankruptcy in 2009,
the company said in a regulatory filing on July 31. (bit.ly/V7AVo3)
Delphi said it was reincorporated in the UK as a limited
liability partnership, which allows it to save tax. The company
said it had filed U.S. federal partnership tax returns between
2009 and 2011.
"We will continue to prepare and file our financial
statements on the basis that neither Delphi Automotive LLP nor
Delphi Automotive Plc is a domestic corporation for U.S. federal
income tax purposes," the company said in the filing.
Delphi, which operates out of Detroit, is one among several
American companies locked in a battle with the IRS over the use
of offshore tax shelters.
The IRS contends that U.S.-based companies operating
globally are manipulating tax laws.
Under the U.S. tax code, domestic companies must pay tax on
total global income, including income generated in other
countries. The workaround for companies is to incorporate in
Delphi has also been in the news in recent months because it
supplied to General Motors Co the defective ignition
switches that were linked to at least 13 deaths.
Delphi's shares closed at $67.31 on Thursday on the New York
(Reporting by Sagarika Jaisinghani and Sweta Singh in
Bangalore; Editing by Kirti Pandey)