European Commission to publish Apple tax inquiry results by spring
Competition commissioner urging swift conclusion to open investigations
There has been speculation in Brussels that the outcome of the European Commission inquiry could stop short of a full indictment of Ireland’s tax rulings with Apple. Photograph: Carlo Allegri/Reuters
Speaking in Brussels, a commission spokesman said competition commissioner Margrethe Vestager “wants to focus on the four open in-depth investigations,” and expects to have the first results by this spring.
There has been some speculation in Brussels that the outcome could stop short of a full indictment of Ireland’s tax rulings with Apple. Minister for Finance Michael Noonan said in November that he expected the case to be dropped, while the Government has said it will challenge any adverse finding at the European Court of Justice.
State aid allegations
The European Commission opened four investigations last year into tax deals offered by Ireland, the Netherlands and Luxembourg. The probes – into Ireland’s arrangements with Apple, Starbucks’ tax practices in the Netherlands, and Luxembourg’s tax deals with Fiat and Amazon – represent the commission’s most significant foray into the tax arrangements of member states. It argues they may constitute illegal state aid.
On Friday, the Luxembourg finance ministry said it was confident allegations of state aid in the Amazon case were “unsubstantiated,” after the European Commission published the letter it sent to Luxembourg in October outlining its concerns.
“Luxembourg is confident that the allegations of state aid in this case are unsubstantiated and that it will be able to convince the commission in due time of the legitimacy of the tax ruling and that no selective advantage has been granted,” the finance ministry said.
In a 23-page letter outlining its reasons for launching an investigation into Luxembourg’s tax dealings, the European Commission said its preliminary view was that “the tax ruling by Luxembourg in favour of Amazon constitutes state aid”.
It is understood that Ms Vestager, who took over as the EU’s competition chief in November is urging a swift conclusion to the four open investigations.
In a surprise move in December, the commission announced it would extend its request for information on tax rulings to all 28 EU countries, a huge logistical challenge. The move came in the wake of the Luxembourg Leaks scandal which exposed the tax tactics used to attract hundreds of companies to the duchy.
The controversy is highly politically sensitive for the EU given that European Commission president Jean-Claude Juncker was prime minister of Luxembourg when most of the tax rulings were negotiated.
Writing in The Irish Times and other international media on Saturday, Ms Vestager and economics commissioner Pierre Moscovici said the European Commission was committed to making tax competition in the EU more transparent.
“We have a situation today where some companies are engaging in aggressive tax planning, made possible by a lack of fiscal harmonisation in the EU and loopholes in national taxation systems,” they said in a joint opinion piece.
They said the commission was committed to reviving its proposal for a common consolidated tax base, an idea opposed by a number of EU countries, including Ireland.