Business World

Thursday 8 December 2016

EU rules Belgium tax breaks for multinationals 'illegal', still investigating Apple and Ireland case

Ailish O'Hora and Sarah Collins

Published 11/01/2016 | 11:52

European Competition Commissioner Margrethe Vestager. Photo: Jock Fistick/Bloomberg
European Competition Commissioner Margrethe Vestager. Photo: Jock Fistick/Bloomberg

The European Commission is still investigating whether Apple received unfair tax advantages in Ireland, and will publish its decision “if and when” it is ready after it ruled that Belgium gave 'selected tax advantages' to at least 35 multinationals.

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"The European Commission has concluded that selective tax advantages granted by Belgium under its 'excess profit' tax scheme are illegal under EU state aid rules," Competition Commissioner Margrethe Vestager said.

It ordered the repayment of €700m.

EU competition chief Margrethe Vestager today denied that there are any problems with the Apple investigation, but confirmed that the probe is taking longer than anticipated.

“No, there is not a problem with the investigation,” she said yesterday in Brussels. “Sometimes you think that a case is just on track .....then something happens, maybe more information is given, maybe you have to answer some questions, then you are upheld,” she said.

She made the comments after ruling that Belgium granted "selective tax advantages” to at least 35 multinationals, mainly from the EU, which allowed them to save around €700m on their tax bills since the scheme started in 2005. The Commission has ordered the Belgian authorities to recover the money but has not named the companies.

The Commission opened an investigation into Apple’s tax affairs in Ireland in June 2014, along with probes into Fiat in Luxembourg and Starbucks in The Netherlands.

Last October, the Commission ruled that the Luxembourgish and Dutch authorities had bestowed illegal tax advantages on the two companies, but failed to come to a conclusion about Apple.

The investigations into Fiat and Starbucks focused on the practice of shifting profits abroad to other companies in a group that are based in low-tax or no-tax countries.

“Sometimes it takes longer than you may have wanted things to take,” she added of the Apple probe. “We will announce a decision when they are ready. We cannot tell you anything about the timing of that,” she said.

The Government has said that it will challenge the Commission if it decides to rule against it in the Apple case.

 ENDS

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