EU Widens Corporate Tax Investigation
September 17 2015 - 8:40AM
Dow Jones News
BRUSSELS—European Union regulators have deepened a high-profile
investigation into alleged sweetheart tax deals after all EU
countries agreed to cooperate with the inquiry, the bloc's
antitrust chief Margrethe Vestager said.
The tax investigations, a political priority for the EU's
executive arm, has already embroiled four multinational companies,
including Apple Inc. and Amazon Inc., and could lead to demands for
large back-tax payments.
"All member states are now cooperating with our inquiries," Ms.
Vestager told European lawmakers at a hearing on Thursday. "This
has allowed us to take the inquiries to a deeper level."
At a hearing in May, Ms. Vestager had complained of difficulties
in obtaining information from some national governments, notably
the Czech Republic, Estonia and Poland. Luxembourg also initially
resisted the EU's requests for tax documents and had fought the
case in court, before relenting in December.
With governments now cooperating, Ms. Vestager said she had
asked countries for a "large number" of tax agreements with
individual companies, to assess whether they breached EU law.
Tax rulings are used to confirm the size of companies' future
tax bills, but the EU has said it suspects some of the agreements
may have granted certain firms an advantage over others, which
would be illegal under EU law.
"We have asked each member state to provide us with 10 to 12
concrete tax rulings to give an idea of how tax rulings are used,"
Ms. Vestager said.
The EU's tax investigation has been repeatedly broadened in
recent months in a sign of its high political priority—despite
concerns around the role of the European Commission's president
Jean-Claude Juncker in supporting several such deals when he was
Luxembourg's Prime Minister.
At a time of austerity across much of the EU, governments are
eager to crack down on tax avoidance to shore up their finances and
demonstrate to taxpayers that wealthy multinationals are paying
their fair share of taxes.
The EU said in June that it would ask 15 national governments to
provide further details of "a substantial number of individual tax
rulings," after broadening its inquiry in December to all EU
countries from an initial group of six.
The investigation has sparked detailed probes into tax deals
struck by four multinationals—Apple in Ireland, Amazon and Fiat SpA
in Luxembourg and Starbucks Corp. in the Netherlands.
Regulators had initially pledged to decide by the end of June
whether those four deals violated EU law. But Ms. Vestager admitted
in May that her agency would miss that deadline, and declined to
give a new one.
"We will close our cases as soon as we are ready to do so," the
commissioner told lawmakers on Thursday. She said she wouldn't
hesitate to open more detailed investigations if she found evidence
that individual tax deals had violated EU law.
Write to Tom Fairless at tom.fairless@wsj.com
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(END) Dow Jones Newswires
September 17, 2015 08:25 ET (12:25 GMT)
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