Friday 30 September 2016

Top Intel executive slams EU's 'naked revenue grab'

Published 11/03/2016 | 02:30

Intel. Photo: Bloomberg
Intel. Photo: Bloomberg

The European Commission's state aid investigations are a "pure naked revenue grab by the EU against US companies", a top executive with Intel has said.

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Ronald Dickel, Intel's vice president for global tax and trade, said US companies in particular were being targeted.

It comes about a month after it emerged that US Treasury Secretary Jack Lew had called on the European Union to reconsider tax probes targeting predominantly US companies, arguing that such moves represented disturbing precedents.

The Commission is carrying out a state aid investigation into the tax arrangements involving Apple and Ireland, and last year adjudicated that tax advantages granted to Fiat in Luxembourg and to Starbucks in The Netherlands were illegal.

A probe into Amazon in Luxembourg is still ongoing as is a similar investigation into McDonalds.

During a panel discussion at the Global Tax Conference in Dublin Castle yesterday, Mr Dickel said Europe was "throwing everything up on its head".

He suggested companies would be concerned about getting a tax ruling from a European country it is considering investing in, because that ruling could be state aid.

"It just seems to be a pure naked revenue grab by the EU against US companies," Mr Dickel said.

David Camp, the former US House of Representatives Ways and Means Committee chairman, told the conference the investigations have piqued the interest of US politicians.

"I do think that there is a feeling that this is revenue deferred and this is tax revenue that the US has decided not to tax and it is not necessarily open for everyone to grab at, and that is a bit different than state aid," he said.

"I think it is very important that the process be a fair one and that it isn't just US multinationals that are being examined in this case, and I think that's something that has really gotten the attention of policy makers in the US."

No decision has yet been given in the Apple case, although the outgoing Government has said it has no case to answer. It has also pledged to take the issue further if the Commission finds against Ireland.

Earlier yesterday, a senior official with the European Commission said patent boxes rank very, very low in terms of direct impact on fostering R&D (Research and Development)

Valere Moutarlier, head of taxation in the Commission, said it is open to each member state to choose to have a patent box, as long as they follow OECD rules.

He said Ireland's Knowledge Development Box would be studied to ensure it complies with the rules.

"We commissioned a study last year where in terms of having an impact on R&D, this way may not be the most efficient one. There are alternative tax incentive schemes that may be more appropriate," he said.

Gary Tobin of the Department of Finance later said the OECD has "told the world" that these boxes are acceptable as long as they fit their rules.

Irish Independent

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