jh-siesta.com
jh-siesta.com January 21, 2018


European Union regulators open investigation into Ikea's Dutch tax deals

20 December 2017, 12:55 | Sammy Green

European Commissioner for Competition Margrethe Vestager | Michael Reynolds EPA

European Commissioner for Competition Margrethe Vestager | Michael Reynolds  EPA

"Member States can not let selected companies pay less tax by allowing them to artificially shift their profits elsewhere", Commissioner Margrethe Vestager in charge of competition policy said.

Vestager has already made resounding decisions against giants like Apple, Starbucks, Fiat, and Amazon, is also investigating McDonald's fast-food giant and French energy company Engie.

The European Commission said it would centre on concerns that two Dutch tax rulings may have allowed part of the group to pay less tax since 2006 - giving the company an unfair advantage over competitors and breaching state aid rules in the process. In return, the IKEA shops are entitled to use inter alia the IKEA trademark, and receive know-how to operate and exploit the IKEA franchise concept. That will involve an assessment of Inter Ikea Systems' contribution to the value of the franchise business and the level of interest deducted from Inter Ikea Systems' tax base in the Netherlands. The money has allegedly been illegally shifted to Luxembourg and Liechtenstein, where IKEA pays less or no tax.

It will also consider whether the price Systems paid for the IP rights and the interest paid for the intercompany loan, endorsed in the 2011 tax ruling, "reflect economic reality".

Competition commissioner Margrethe Vestager said in a statement: "All companies, big or small, multinational or not, should pay their fair share of tax".

A probe into Ikea, one of Europe's best-known brands, may ease criticism Vestager has received for focusing on how US companies reduce taxes.


The 2006 ruling endorsed a tax arrangement that IKEA's core company used to shift "a significant part" of its revenues to a special tax scheme in Luxembourg that was exempt from corporation tax. However, the Swedish company claims that several points of the report are mistaken, but this will not stop the European Commission from clarifying whether Ikea may have received illegal state aid in the Netherlands. It also endorsed the interest to be paid under loan to the parent company and the deduction of these interest payments from Systems' taxable profits in the Netherlands.

In April, the Commission ordered Amazon to pay €250m (£221m) in back taxes to the Luxembourg government after ruling that a 2003 tax deal amounted to illegal state aid. In particular, it will assess if the level of the annual license fee reflects Inter IKEA Systems' contribution to the franchise business.

The news came after leaked documents showed that Apple had chosen to move a subsidiary from Ireland to Jersey in order to continue avoiding billions in taxes, after an European Union crackdown in 2013.

Under EU law, member nations are not allowed to give selective benefits of taxes to multinational groups that other firms do not have access to.

Ikea said it complies with all tax rules, and would cooperate with regulators.



Other News

Trending Now

Overwatch's Winter Wonderland event returns with new Mei content
All the new skins will appear alongside last year's skins so you can potentially hoover up any that you missed last time around. One such game is Overwatch , which will host its Winter Wonderland event for the second year in the row beginning next week.

Alaska is 29th in state health ranking
Premature death, defined as deaths before the age of 75, in addition to cardiovascular and drug deaths are on the rise as well. MA has been climbing in the rankings since the first report was released in 1990, according to the United Health Foundation.

Trump Deutsche Bank Records Said to Be Subpoenaed by Mueller
Earlier this year, Mr Trump said pursuing his personal finances would be a breach of Mr Mueller's role as special counsel. Deutsche Bank is not the only Trump-related business interest that is attracting the attention of investigators.

CNN corrects report about Trump campaign and Wikileaks tip
On Sept 13, the day before the email, WikiLeaks had tweeted links to what the group said was 678.4 megabytes of DNC documents. It arrived about a week before WikiLeaks itself messaged Trump Jr. and began an exchange of direct messages on Twitter.

Gareth Bale's victor saves Real Madrid from humiliation against Al Jazira
With the win Real Madrid go through to Saturday's final in which they will play Brazilian side Gremio. With the strike, Ronaldo became the all-time best scorer in the Club World Cup with six goals.

UNSC resolution on Jerusalem vetoed by US
Delattre said France will support it and that he expected the "overwhelming majority" of council members to do the same. This has infuriated the Palestinians and Arab countries, which have strongly protested against the USA move.

Armed police open fire on knifeman at Amsterdam airport
The situation is now safe, the Marechaussee police service said, and the suspect had been detained and removed from the scene. Shocked travelers fled when the man, who has not been identified, began threatening crowds with his knife.

Rudy Gobert Knee Injury Reportedly Diagnosed as Sprained PCL; Out 1 Month
All but one of their next eight games are against teams that rank Top 10 in overall net rating so far this season. Gobert has appeared in 18 games this season, averaging 11.6 points, 9.6 rebounds, and 2.3 blocks a night.

Wilfried Bony: My time at Manchester City can help Swansea
Liverpool are fifth on goal difference after a 0-0 draw at home to dogged West Bromwich Albion at Anfield. City dominated Swansea from the start, with Silva taking his tally to four goals in three games.

Australia Lawmakers Allow Same-Sex Marriage Bill
The house spent the day voting on amendments to the bill, none of which passed (otherwise it would have gone back to the Senate). The law will likely come into effect in about a month, with the first wedding expected about a month later.