Tax structures in the spotlight
Euro magazine dropped a bombshell this week when it revealed
confidential information about Eurotel's tax scheme for expat
managers. Euro suggested that the structure, which was devised
by PwC, was illegal and could lead to criminal charges against
ex-CEO Terrence Valeski. PwC refused to comment, which lent
credibility to the insinuations. (Oddly, PwC has been hired to do
a forensic audit of the very tax structure it itself recommended.)
Euro had accurate information but intentionally told only part of
the story. Valeski in fact had a base salary of Kè 12.5m, not Kè
50m, and the tax structure was approved by Èeský Telecom.
This episode represents a degradation in what is considered fair
game in business conflicts. Foreign investors will be wary of
coming to a country if they have reason to fear that their tax
structures will be smeared through the press. expatriat
PricewaterhouseCoopers
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