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Intel faces $600m tax bill

Intel has disclosed that it may have to pay approximately $600m in back taxes, plus interest.

Intel has disclosed that it may have to pay approximately $600m in back taxes, plus interest.

The chip maker said that during a regular review of its tax returns for the years 1999 and 2000, the Internal Revenue Service proposed an adjustment relating to the company's tax benefit for export sales.

Furthermore, in the filing submitted to the US Securities and Exchange Commission, Intel said that the IRS may make similar claims for years after 2000 in future audits.

"The company disputes the proposed adjustments and intends to pursue this matter through applicable IRS and judicial procedures, as appropriate," Intel stated in the filing.

The company added that if it has to pay the back taxes there "exists the possibility of a material adverse impact on the results of operations for the period".

Intel reported revenue of $6.8bn for the second quarter of 2003, compared with $6.3bn for the same period last year. Net income increased 101% from the second quarter of last year, to $896m

Scarlet Pruitt writes for IDG News Service

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