(CN) – AT&T will pay $48.75 million to 270 Missouri cities to settle a class action over back taxes. An additional $16.25 million in attorney’s fees will make the total payment $65 million.
AT&T underpaid business taxes on land lines. AT&T claimed, unsuccessfully, that some of its earnings were tax-free, by ordinance.
AT&T will also pay the cities $10 million a year in the future, under the settlement. The cities agreed to not challenge AT&T’s right to pass along some of its costs to customers.
But AT&T said it would not pass on to customers any costs related to attorney’s fees.