Double Flee A

State scores in tax royalty suits, this is a weird loophole. "In this case Toys R Us advertises using a giraffe mascot named Geoffrey. But TRU does not own the rights to that mascot, instead Geoffrey, Inc (a TRU subsidiary) owns them. So the toy store "licenses" the trademark from Geoffrey, Inc, at a hefty rate, then calls that a business expense and deducts from its pre-tax income. Since GI isn't a Louisiana company, TRU argued that it doesn't need to pay LA taxes on it's income. The judge disagreed."

posted by dale @ 10:06 PM