Square is also expected to hire certain key Credit Karma employees that today support Credit Karma Tax. Under the terms of the proposed settlement, Intuit and Credit Karma must divest the assets that comprise Credit Karma Tax to Square, Inc., including relevant software and intellectual property. The combination of Intuit and Credit Karma would eliminate this competition, likely resulting in higher prices, lower quality, and less choice for consumers of DDIY tax preparation products. This always-free business model has enabled Credit Karma Tax to compete aggressively for filers who pay for TurboTax, which helps constrain TurboTax prices and push Intuit to improve TurboTax offerings. Unlike other providers, including Intuit, Credit Karma Tax never charges for its products, regardless of the complexity of an individual’s tax preparation needs. Since entering four years ago, Credit Karma Tax has become a disruptive competitor with a significant competitive impact. “Today’s divestiture to Square, another highly successful and disruptive fintech company, ensures that taxpayers will continue to both benefit from this competition and benefit from new innovative financial service offerings from both Intuit and Square.”Īccording to the complaint, Intuit’s TurboTax has enjoyed a dominant position in the market for DDIY tax preparation products for more than a decade. “Intuit’s TurboTax has long led the market for digital do-it-yourself tax filing services, but disruptive competition from Credit Karma Tax has brought substantial benefits to American taxpayers,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in the department’s complaint. District Court for the District of Columbia to block Intuit’s acquisition of Credit Karma. The Justice Department’s Antitrust Division filed a civil antitrust lawsuit today in the U.S. The department said that without this divestiture, the proposed transaction would substantially lessen competition for digital do-it-yourself (DDIY) tax preparation products, which are software programs used by American taxpayers to prepare and file their federal and state returns. in order for Intuit, the creator of TurboTax, to proceed with its $7.1 billion acquisition of Credit Karma. (Credit Karma) to divest Credit Karma’s tax business, Credit Karma Tax, to Square Inc. The Department of Justice announced today that it is requiring Intuit Inc.
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