Safeway announced yesterday (10 April) that it has settled a tax refund claim with the Internal Revenue Service. As a result, the retail operator anticipates receiving a refund of approximately US$315m in the second half of 2006.
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The settlement relates to Safeway’s claim for refunds between 1992 and 1999 for costs associated with debt financing. The refund is expected to total $259m including an additional $56m in accumulated interest.
The company added that it has similar claims for refunds of income tax and interest in several states. As of 7 April 2006, the company expects these state income tax refunds and interest will be approximately $30m and $10m, respectively, net of income tax. Collection of these funds may take several years, Safeway said.
