While Tesla Inc. reported a zero-dollar federal tax bill for 2025, findings have revealed another significant source of tax savings for the company.

Over the past two decades, Tesla has reported little to no U.S. federal tax liability in most years, largely due to deductions from prior losses and incentives tied to clean energy tax credits, Reuters reported.

However, a review of Tesla’s corporate filings by the publication revealed another significant source of savings. Tesla’s subsidiaries in the Netherlands and Singapore reported $18 billion in untaxed profits. If not for profit shifting, a financial strategy that reallocates earnings across jurisdictions, these profits would likely have been declared and taxed in the U.S., which could have resulted in Tesla paying over $400 million more in U.S. taxes, the report said.

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TM International is registered in the Netherlands as a non-resident partnership. According to Dutch registry records, it has no employees and is not required to file financial statements or pay Dutch taxes. Dutch and Singapore filings provide no details on the partnership’s operations or profit sources, and show Tesla Motors Singapore Holdings is not taxed in Singapore on related income, the report said.

Tesla’s tax practices are not unlawful, Reuters said, but they have prompted scrutiny over the company’s use of tax loopholes. The company has not publicly addressed any profit shifting, nor clarified how its Dutch and Singaporean subsidiaries factor into its tax strategy.

Tesla did not immediately respond to Benzinga’s request for comments.

Tesla’s tax practices have been under scrutiny for some time. In March, Sen. Bernie Sanders (I-VT) accused Elon Musk of paying an effective tax rate of less than 3.3%, less than the average tax rate of a truck driver, nurse, and teacher. He called for the wealthy and corporations to pay their fair share.

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Following this, in April, Representative Pramila Jayapal and Sen. Elizabeth Warren (D-Mass.) proposed the Ultra-Millionaire Tax Act to rectify the situation. The proposed legislation aims to apply a 2% annual tax and 1% surcharge to fortunes above $50 million.

At an October 2024 Pennsylvania town hall, Musk said he is often offered aggressive legal tax-avoidance strategies but tends to reject them when they seem questionable. In response to a question on corporate taxes, he noted that such “loopholes” can sound “pretty shady” and said he does not believe they should be used.