Tesla Inc. has been accused of shifting approximately $18 billion in profits to international subsidiaries in the Netherlands and Singapore to minimize its U.S. tax obligations. According to a Reuters analysis of corporate filings and regulatory documents released on April 20, 2026, the electric vehicle manufacturer utilized a complex financial structure to reduce its domestic tax liability by at least $400 million between 2023 and early 2025.
The investigation, which reviewed thousands of pages of documents across 14 countries, identified two primary entities involved in the profit-shifting strategy: TM International, a Dutch-based partnership, and Tesla Motors Singapore Holdings. TM International is registered as a non-resident partnership in the Netherlands and reportedly has no employees. Under Dutch law, the entity is not required to file public financial statements or pay local taxes.
Filings in Singapore revealed that Tesla Motors Singapore Holdings received the $18 billion in profits from the Dutch partnership during the period in question. Despite reporting these massive earnings, the Singaporean unit sold only 6,633 vehicles during that timeframe. The $18 billion figure represented roughly 89% of Tesla’s total global operating income for those years, even though the United States has historically accounted for approximately half of the company’s total revenue.
Tax experts, including former U.S. Treasury official Stephen Shay and University of Michigan tax law professor Reuven Avi-Yonah, stated that the maneuver likely involved the offshore reallocation of intellectual property rights. This allowed income that would otherwise be taxable in the United States at the 21% corporate rate to be recognized in jurisdictions with more favorable tax treatments. Avi-Yonah noted that the strategy appeared designed entirely to move profits to low-tax jurisdictions.
The report also highlighted Tesla’s historical tax record, noting that the company reported zero federal tax liability in the U.S. for nearly two decades, with the exception of 2023. While the company has reported $6.4 billion in foreign tax liabilities over the years, its domestic tax estimates have remained significantly lower, often offset by clean energy credits and prior losses.
A recent regulatory disclosure cited in the report suggests Tesla may have recently altered this financial structure. In 2025, the company reported that more than 90% of its global profits were generated domestically, a sharp contrast to the figures identified in the offshore units during the preceding years.
Tesla did not immediately respond to requests for comment regarding the Reuters findings or the specific roles of its Dutch and Singaporean subsidiaries. While the practice of profit shifting is a common and often legal tactic used by multinational corporations, the scale of the transfers has prompted renewed scrutiny from transparency advocates and lawmakers.