Porsche has found a loophole in Germany’s law books that will allow the Stuttgart-based automaker to sell the remainder of its sport car business to Volkswagen without paying any taxes.
According to a report in WirtschaftsWoche, Porsche has come to terms with the tax office in Stuttgart over a plan that will allow the company to sell its remaining 51.1 percent ownership to VW without paying a cent of taxes. VW currently owns a 49.9 percent stake in Porsche’s sports car business.
VW will reportedly pay $5.62 billion to complete its purchase of Porsche, according to Reuters, which would leave the sports car maker on the hook for $1.9 billion worth of taxes. However, the state financing ministry has ruled that the sale is actually a restructuring, allowing Porsche to avoid its tax bill.
So far neither side has commented on the report, although VW says it is still exploring ways to integrate the two companies beyond a full buyout.
Porsche could duck all taxes in VW purchase deal