PepsiCo Scores Big Win in Royalty Tax Dispute With Australia (1)

PepsiCo won a long-running court battle against Australia Wednesday over the payment of royalty taxes, an issue that threatened to raise taxes for almost all multinationals operating in the country.

The High Court of Australia said the price paid for the sale of beverage concentrate from a Pepsi affiliate in Singapore to an Australian bottler didn’t include embedded royalties, as claimed by the Australian Taxation Office, and dismissed the ATO’s appeal of a lower court loss, with costs.

PepsiCo didn’t get an improper tax benefit from the transaction, according to the court, so the sale was not subject to the ...