AmEx pitched business clients tax break that may have skirted laws
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© Reuters. American Express’ logo can be seen in Los Angeles (California), United States April 25, 2016. REUTERS/Lucy Nicholson/Files(Reuters) – American Express Co (NYSE: ) offered its clients tax breaks that may have evaded taxes, according to the Wall Street Journal on Monday. It cited people who were familiar with the situation and reviewed documents.
This report stated that the tax strategy relied on “shaky” interpretations of the law governing reward points. It also said that this pitch was instrumental in helping the credit card issuer make billions of dollars from transaction volumes since at most 2018.
Reuters reached AmEx for comment but they did not respond immediately.
According to the WSJ, a whistleblower submitted a report to the Internal Revenue Service in July alleging that the company had knowingly convinced its clients who owned businesses to not properly declare their income or taxes.
AmEx found the pitch internally and hired a lawyer firm to investigate it, the report stated. Citing a spokesperson, the reporter said AmEx had fired, disciplined, compensated, and adjusted its compensation plans for some employees.
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