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General Motors file lawsuit to recoup $108M in taxes from City of San Francisco

General Motors is suing the City of San Francisco over taxes it says were wrongly attributed to it over its links to self-driving car unit Cruise. File Photo by Jeff Kowalsky/EPA-EFE
General Motors is suing the City of San Francisco over taxes it says were wrongly attributed to it over its links to self-driving car unit Cruise. File Photo by Jeff Kowalsky/EPA-EFE

Dec. 28 (UPI) -- General Motors filed a lawsuit against the City of San Francisco, arguing the municipality overcharged it $108 million in taxes and $13 million in interest for linking it to its self-driving car Cruise division.

GM argued in court papers filed in California Superior Court in San Francisco County last week that Cruise, which GM purchased in 2016, operates separately and has different revenue models. The auto giant said its subsidiary has operated "at arm's length" since its purchase.

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Cruise's headquarters are based in San Francisco while GM has long maintained its Detroit headquarters address. GM said it has little presence in San Francisco with no employees, plants or dealerships.

"Cruise's technology and autonomous vehicle rideshare with goods delivery business is fundamentally different from GM's business," GM said in the lawsuit.

GM said San Francisco erroneously used Cruise's footprint in San Francisco to tax GM's global revenue of $3 billion instead of its locally generated revenue.

General Motors, though, had been regularly paying the tax bill and did not explain in court documents why it has waited until now to dispute the comingled charges with Cruise.

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Cruise has seen its share of challenges lately with nine executives leaving the company during an ongoing investigation into the company's handling of a San Francisco incident in October where a woman was hit by a human driver and thrown into the path of a Cruise robotaxi, which then dragged her under the car.

In November, Cruise recalled all 950 of its self-driving systems and issued a software update in connection with the October incident.

Cruise's report to the National Highway Traffic Safety Administration said the Oct. 2 incident occurred as a result of a safety response that caused its autonomous vehicles, or AVs, to pull over out of traffic after a collision.

On Oct. 26, Cruise stopped its operations across all of its fleets two days after California suspended the company's permit to operate driverless vehicles in the state over its handling of the Oct. 2 incident.

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