HP accused of evading import taxes

HP accused of evading import taxes

Hewlett-Packard is being investigated by the US Customs Service for allegedly conspiring to avoid paying taxes on more than $US6 million worth of imported computer parts, a company spokesman confirmed today.

The investigation relates to late paperwork filed with the Customs Service by an affiliate of HP's which acts as a "foreign trade zone" for the company, said HP spokesman David Hargarten. Such a designation allows a company to warehouse imported goods without paying duties on them until they are sold.

HP has since terminated its foreign trade zone agreement with the affiliate, Artesyn Solutions of Lincoln, California, although the company still does repairs and refurbishment work for HP, Hargarten said.

HP has cooperated with the Customs Service since it was informed last summer that the paperwork had not been filed, and the company is surprised at the agency's action, Hargarten said.

HP hired an auditor after it was informed of the irregularities to see which documents were late, and believes it has now paid the import taxes and duties in full, Hargarten said. HP paid duties totalling $US75,000 for the goods in question, he said.

"HP doesn't believe that we've done anything wrong, and when we work through the resolution of this, that will confirm our position," he said.

Artesyn and the Customs Service could not immediately be reached for comment.

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