Australia Appeals PepsiCo Tax Case to Highest Court (Correct)

Australia is appealing to the country’s highest court a lower court ruling favoring PepsiCo Inc. in a high-stakes royalties tax case.

The Australian Tax Office filed its appeal Aug. 8 to the High Court of Australia. It’s challenging a June decision by the full federal court that PepsiCo wasn’t liable for royalty withholding taxes stemming from a sale of beverage concentrate from a Singapore Pepsi affiliate to an Australian bottler, to manufacture and distribute Pepsi products in Australia.

In a split decision, the June ruling said PepsiCo also wasn’t liable for Australia’s diverted profits tax, or DPT—a harsh penalty tax ...