Germany’s Deutsche Post DHL has been ordered by German financial authorities to pay EUR516 million (US$644 million) in back taxes incurred from 1998 to 2010.
The logistics and postal giant will make a one-time payment of the amount in the third quarter of 2012 that it said would impact on its earnings before taxes and interest (EBIT) as well as net profit.
Since the company had already set aside partial reserves for the tax liability, group EBIT in the second quarter of 2012 would be impacted by EUR180 million and net profit by EUR265 million, the company said in a statement.
It stressed that the previous guidance for 2012 remained in place.
The German government imposed additional value-added taxes (VAT) on Europe’s leading express services provider after a retrospective review of complex tax issues covering the period from 1998 to 2010, the year the revised VAT law for postal services came into force, Deutsche Post DHL said.
The company added that it opted not to contest the decision in order to “establish legal certainty and avoid years of legal battles with uncertain outcomes.”
