WASHINGTON (AP) - Sen, Carl Levin says manufacturing giant Caterpillar Inc. has used an aggressive tax strategy to shift profits overseas in order to avoid paying billions in U.S. taxes.
The Michigan Democrat chairs the Senate Permanent Subcommittee on Investigations. The committee's Democratic staff says in a report released Monday that Caterpillar avoided paying $2.4 billion in U.S. taxes since 2000 by shifting profits to a wholly-controlled affiliate in Switzerland.
The report raises questions about the validity of the tax strategy but does not accuse the Peoria, Ill.-based manufacturer of breaking the law.
Julie Lagacy, a Caterpillar vice president, said in a statement that the company complies with all tax laws. She said Caterpillar pays an effective income tax rate of 29 percent, among the highest for multinational manufacturers.
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