KFC ordered to pay Iowa Income Taxes

DES MOINES, Iowa (AP) — Iowa didn't violate any laws when it assessed fried-chicken giant KFC Corp. nearly $250,000 for unpaid corporate income taxes, even though it had no restaurants or employees in the state, the Iowa Supreme Court ruled Thursday.

All KFC restaurants in Iowa are independent franchises, whose owners pay KFC for the use of its logo and systems. The company also requires franchises to adhere to its requirements for menu items, marketing and facilities.

The Iowa Department of Revenue and Finance assessed KFC more than $248,000 in unpaid corporate income taxes, including interest and penalties, in 2001. The taxes were for 1997 to 1999.

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