Target to get $ 1.6 B tax break after exit
Target Corp.’ s swift exit from Canada will reap about $ 1.6 billion US in tax breaks for the retailer in the United States, according to documents filed with the U. S. Securities and Exchange Commission.
The Minneapolis, Minn.,- based company said it had already recognized the majority of the tax benefits in first- quarter filings and expects to book most of the rest before the end of 2015.
The tax breaks help offset pretax losses of $ 5.1 billion that were booked on its failed Canadian launch.
“Our Canada exit represents a strategic shift in our business,” the company said in the documents filed March 13.
Target Corp. announced in January that it would close all 133 Canadian stores, most which opened in 2013 in phases beginning in Ontario, saying it would take years for the Canadian operations to turn a profit.
The retailer has been in court to iron out the details of its departure, dealing with a variety of creditors that include landlords, suppliers and others affected by the closures.
Liquidation companies have been overseeing the sale of Target’s inventory since last month.
Other issues outlined in the SEC filing include costs of a data breach in December 2013 that exposed details on as many as 40 million credit and debit card accounts.
On Thursday, a Minnesota judge endorsed a settlement in which Target Corp. will pay $ 10 million to settle a class- action lawsuit over the massive data breach.
The class- action settlement covers only U. S. citizens and not Canadians who were affected by the breach.