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Mass. and Comcast in Dispute Over Taxes

The Massachusetts Department of Revenue and telecommunications company Comcast Corp. are involved in a legal dispute over a $250 million tax bill the state says it is owed.

The Revenue Department is arguing that Philadelphia-based Comcast is attempting to benefit from a series of sham transactions designed to avoid a tax bill associated with the $11.8 billion acquisition of Boston-based Continental Cablevision in 1996.

Comcast inherited the company in 2002 through a series of mergers as the telecommunications industry consolidated.

The dispute was filed last month with the Massachusetts Appellate Tax Board.

Comcast’s attorneys have challenged the Revenue Department’s assessments of more than $100 million in taxes in connection with the Continental deal.

Including interest and penalties, the revenue department’s claims against Comcast total an estimated $250 million.

”Comcast pays well over $100 million in taxes and fees every year to Massachusetts and its cities and towns,” company spokeswoman Shawn Feddeman said Thursday. ”We take our responsibility to pay taxes very seriously. This is an issue that we inherited from our acquisition of AT&T Broadband at the end of 2002 that dates back more than 10 years. We are working with the state to resolve this matter.”

Barring a settlement, the case could take years to make it way through the system.