Carolina Hurricanes owner Peter Karmanos is among the major-league team owners mentioned by The Guardian newspaper as benefiting in the past from offshore tax havens.
Karmanos and other owners in the NFL and NBA appeared the Paradise Papers, a special investigation by The Guardian – the British daily – and 95 media partners into more than 13 million leaked files from two offshore service providers and the company registries of 19 tax havens.
Karmanos, interviewed by The Guardian, did not deny forming a Barbados company while chairman and CEO of Compuware, the Detroit-based software company he co-founded.
According to the leaked files, Karmanos created a Compuware subsidiary in Barbados in 1988 as a foreign sales corporation. It was not taxed by Barbados and Karmanos told The Guardian the company was “perfectly appropriate” under the U.S. tax laws at the time.
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The subsidiary was dissolved in September 2011, The Guardian reported.
Under the tax laws created under former president Ronald Reagan, owners of foreign sales corporations were absolved of paying U.S. taxes on a third of the overseas income. The tax laws later were changed.
“Everybody was doing it,” Karmanos told The Guardian. “That’s why they ended it.”
Karmanos declined further comment Thursday.
Among the other owners mentioned by The Guardian were Robert Kraft of the New England Patriots and NBA owners Micky Arison of the Miami Heat and Steve Pagliuca of the Boston Celtics.