Oracle disputes $20 million tax bill

The sum in dispute puts it at the higher end of the recent battles Inland Revenue has had with technology multinationals.

The New Zealand arm of software multinational company Oracle underpaid more than $20 million in tax by overpaying for services supplied by its overseas parent, Inland Revenue believes.

Oracle, which is chaired by flamboyant billionaire Larry Ellison, revealed last year that it was in dispute with the tax department over its ‘‘historic transfer pricing practices’’.

The latest accounts of its New Zealand subsidiary, filed with the Companies Office just before Christmas, showed the amount Inland Revenue had claimed was $20.3m, for a period between 2012 and 2015.

Oracle New Zealand said it had lodged statements contesting the claim with the High Court and was working with Inland Revenue to explore remedies to resolve the matter.

The company considered Inland Revenue’s claims were ‘‘without basis’’, it said.

The sum in dispute puts it at the higher end of the recent battles Inland Revenue has had with technology multinationals.

Microsoft New Zealand said in 2019 that it had paid just under $25m in back taxes to settle a dispute with Inland Revenue over its transfer pricing practices.

The New Zealand arm of United States networking giant Cisco Systems said last year that it had paid $4.6m in back taxes to Inland Revenue after a tax audit, also of its transfer pricing practices.