UPDATE 1-Argentina accuses Procter & Gamble of tax fraud, says suspends operations
(Adds company comment, background on company operations in Argentina)
By Hugh Bronstein and Nandita Bose
Nov 2 (Reuters) - Argentina has accused Procter & Gamble , the world's No. 1 household products maker, of tax fraud and said it suspended its operations in the South American country, according to a statement issued on Sunday by the country's AFIP tax authority.
It was unclear what the government meant by suspended, and the company declined to comment on whether its operations had been halted.
Argentina accused the company of over-billing $138 million in imports to get money out of the country, according to the statement, which was published on Argentina's presidential website (www.prensa.argentina.ar).
"P&G funneled currency abroad and hid income that was subject to tax in Argentina," it said.
"We have to put an end to these tricks used by international companies," the statement added.
Procter & Gamble spokesman Paul Fox said the company is working to understand fully the allegations and resolve them.
"We don't pursue aggressive tax/fiscal planning practices as they simply don't produce sustainable results," he said adding the consumer products maker values its relationship with the country and its consumers. Continuación...