Tuesday, October 6, 2015
Following up on my previous post, Avi-Yonah: Vanguard Owes $35 Billion In Back Taxes: Reuven S. Avi-Yonah (Michigan), Too Big to Tax? Vanguard and the Arm’s Length Standard, 149 Tax Notes 105 (Oct. 5, 2015):
In this article, Avi-Yonah asserts that the Vanguard Group has been allowed to dominate the mutual fund industry and avoid billions of dollars in corporate taxes by providing at-cost services to commonly controlled funds, in violation of the arm’s-length standard. He argues that the IRS could successfully challenge Vanguard’s transfer pricing but warns that the tax liability would ultimately be borne by the millions of Vanguard fund investors.
Avi-Yonah is an expert witness for the claimant in a whistleblower action against Vanguard, but he is compensated without regard to the outcome of that case.