EU Probing Apple Tax Rulings in Ireland, Luxembourg and the Netherlands

Advertisement
By Reuters | Updated: 11 June 2014 18:30 IST
The European Commission said on Wednesday it had opened three in-depth investigations into tax decisions affecting Apple, Starbucks and Fiat Finance and Trade in Ireland, the Netherlands and Luxembourg respectively.

The probes focus on whether decisions by authorities in the three European Union member states about corporate tax to be paid by the three companies comply with state aid rules.

Corporate tax avoidance has risen to the top of the international political agenda in recent years amid reports of how companies like Apple and Google use convoluted structures to slash their tax bills.

(Also see: Google, Amazon and Starbucks to face UK lawmakers over tax)

Advertisement

The EU said its investigation follows reports some companies have received significant tax reductions through rulings by national authorities.

Advertisement

Apple said it has not received any selective tax treatment from the Irish authorities, while the Irish government said it was confident that it has not breached state aid rules will defend its position vigorously.

Fiat declined to comment and Starbucks was not immediately available for comment.

Advertisement

Starbucks told a UK parliamentary investigation in 2012 that it received a tax deal in the Netherlands which allowed it to enjoy a "very low" tax rate, while a U.S. Senate probe last year revealed that Apple had sheltered tens of billions of dollars in profits from tax by using Irish companies that had no tax residence anywhere.

Apple in the United States entered into deals with the Irish subsidiaries whereby the Irish units received the rights to certain intellectual property that were subsequently licensed to other group companies, helping ensure almost no tax was reported in countries such as Britain or France.

Advertisement

Apple's Irish arrangement helped it achieve an effective tax rate of just 3.7 percent on its non-U.S. income last year, its annual report shows - a fraction of the prevailing rates in its main overseas markets.

(Also see: Apple, Google's tax avoidance strategies to be scrutinised at European leaders meet)

Tax rulings are used in particular to confirm transfer pricing arrangements, covering prices charged for transactions between various parts of the same group of companies.

The Group of 20 leading nations has launched a drive to develop new rules to tackle abusive transfer pricing and other forms of corporate profit shifting.

© Thomson Reuters 2014

 

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.

Further reading: Apple Tax, Apple, Fiat, Google, Google Tax, Starbucks, Tax, EU
Advertisement

Related Stories

Popular Mobile Brands
  1. Vivo Confirms OriginOS 6 Update Schedule in India: See Release Timeline
  2. Red Magic 11 Pro Series With Liquid Cooling Launched at This Price
  3. OnePlus Pad 2 With Dimensity 9400+ SoC to Launch Alongside OnePlus 15
  4. Kantara: A Legend Chapter-1 Lands on Amazon Prime Video Soon
  5. Marvel's First Family Could Arrive on OTT Platforms Soon
  6. OnePlus Finally Announces Launch Date of OnePlus 15 and OnePlus Ace 6
  1. Vast Space to Launch Haven-1, the World’s First Private Space Station in 2026
  2. Atmospheric Carbon Dioxide Soars to 424PPM, Marking Biggest Yearly Jump Ever
  3. Black Hole Tears Star Apart, Sends Out Powerful Flares Six Months Later
  4. Shakthi Thirumagan OTT Release: When, Where to Watch Vijay Antony-Starrer Action Thriller Online?
  5. Former Assassin's Creed Boss Says He Was Asked to 'Step Aside' by Ubisoft
  6. Arshad Warsi's Bhagwat Chapter 1: Raakshas OTT Release: Everything You Need to Know About This Thriller
  7. Vivo Confirms OriginOS 6 Update Rollout Schedule in India: Check Full Release Timeline
  8. Huawei Nova Flip S Launched With 4,400mAh Battery, 2.14-Inch Cover Screen: Price, Features
  9. The Fantastic Four: First Steps Reportedly Set for OTT Debut Soon: All You Need to Know
  10. Huawei Nova 14 Vitality Edition Launched With 5,500mAh Battery, 50-Megapixel Selfie Camera: Price, Specifications
Gadgets 360 is available in
Download Our Apps
Available in Hindi
© Copyright Red Pixels Ventures Limited 2025. All rights reserved.