EDS could be about to lose its 10-year IT services contract with the Inland Revenue.
The Revenue's supervisory board has recommended that the £3bn Aspire contract to modernise tax and national insurance systems be awarded to Cap Gemini Ernst & Young and Fujitsu.
The decision on whether to transfer the systems from EDS, which has run the Inland Revenue's computers since 1994 and Accenture, which runs national insurance systems, is now in the hands of ministers.
The Inland Revenue shortlisted three consortia, EDS with Accenture, Cap Gemini Ernst & Young with Fujitsu and BT with Computer Sciences Corporation and Schlumberger Sema, and paid each consortium £2.9m contribution to the costs of the tender.
EDS was last week heavily criticised by MPs on the House of Commons Public Accounts Committee for problems with the introduction of tax credits.