The European Union’s competition commission has requested information from Luxembourg to determine if tax deals granted to Amazon violate state aid rules, according to unnamed sources interviewed for a July 3 FT report.
Meanwhile, in a July 4 article, Bloomberg has reported that EU is scrutinizing the taxation of Microsoft and McDonald’s operations in Luxembourg.
The actions appear to be part of a wider EU investigation into whether tax rulings and patent box regimes that benefit multinational firms are permitted under EU law. The European Commission, on June 11, formally announced that it is investigating whether individual transfer pricing rulings granted to Apple in Ireland, Starbucks in the Netherlands, and Fiat in Luxembourg sanctioned the allocation of too little profit to activities in those countries, thereby amounting to illegal state aid.
Luxembourg has resisted earlier investigations, causing the EU to initiate infringement proceedings against the country for failure to provide requested information. In a June 12 statement, Luxembourg said it would continue to defend against the Commission’s charges of illegal state aid, and that still had doubts about the legality Commission requests for information. For details, see FT, Bloomberg, prior coverage
