EU Commission to investigate tax ruling practices of all EU states

The European Commission has enlarged its state aid investigation into private tax ruling practices to cover all 28 European Union states.

“The Commission will ask Member States to provide information about their tax ruling practice, in particular to confirm whether they provide tax rulings, and, if they do, to request a list of all companies that have received a tax ruling from 2010 to 2013,” the Commission said December 17 in a press release.

“We need a full picture of the tax rulings practices in the EU to identify if and where competition in the Single Market is being distorted through selective tax advantages. We will use the information received in today’s enquiry as well as the knowledge gained from our ongoing investigations to combat tax avoidance and fight for fair tax competition,” Commissioner in charge of competition policy, Margrethe Vestager said.

The decision follows the uproar over the release of leaked Luxembourg private rulings and tax returns, published on the Internet on November 5 by the International Consortium of Investigative Journalists. The documents reveal that Luxembourg has helped scores of multinationals avoid tax by sanctioning complex deals in private tax rulings. Vestager has said that she would investigate these rulings for state aid violations.

The European Commission had previously announced state aid investigations into rulings granted to Apple in Ireland, Starbucks in Netherlands, and Fiat and Amazon in Luxembourg. The Commission said that, since June 2013, it has also been investigating tax rulings practices in Cyprus, Malta, the Netherlands, and the UK, and has requested information on specific rulings from Belgium.

The Commission also said it is investigating intellectual property taxation regimes in Belgium, Cyprus, France, Hungary, Luxembourg, Malta, The Netherlands, Portugal, Spain, and the UK.

 

See:

• European Commission release

Related MNE Tax articles:

• EU Commission will scrutinize ‘Lux Leaks’ tax rulings for state aid violations, says competition chief

• Journalists publish leaked PwC advance rulings and tax returns, conclude that Luxembourg aids tax avoidance

• Private tax rulings granted by Luxembourg to Amazon under EU scrutiny

• EU probes whether tax rulings granted to Apple in Ireland, Starbucks in Netherlands, and Fiat in Luxembourg violate state aid

 

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UPDATE: in December 17 statement, Luxembourg Minister of Finance  Pierre Gramegna said he welcomed the initiative. “Luxembourg has repeatedly stated that the analysis of matters relating to international taxation and tax rulings calls for a broad perspective, and cannot be limited to one country’s regulatory framework and practice,” he said. See, Luxembourg release.