Software major Infosys on Tuesday said it was mulling how it would respond to the California state administration's rejection of its plea seeking tax relief under an alternative filing methodology permitted by the California tax code.
"We are in discussions with our consultants on the future course of action," an Infosys spokesperson told PTI in Bangalore.
Reports from the United States said that Infosys, which has its American headquarters in Fremont California, had sought relief citing that the standard tax formula computed by the state failed to take into account that two-thirds of Infosys project work was done offshore in India, and that there was a differential in the wages between its staff in India and that in California.
Infosys said it already has paid the inflated tax of $1.3 million for financial years 2001-02 and 2002-03, but had argued that it owed only $180,000 due to the differential in offshore wages.
"Infosys pays taxes in all jurisdictions where it operates based on domestic regulations and also using internationally recognised tax practices. We have filed returns and paid taxes in the state of California as per the regulations laid out in the domestic tax courts," it said.
"We have not requested any tax breaks or incentives but have requested for a filing methodology that is permitted by the California Revenue and Taxation Court Section 25137," Infosys said.
