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EU: Vestager responds to reports of secret tax deals

By  |  November 6, 2014
EU: Vestager responds to reports of secret tax deals

A report released by the International Consortium of Investigative Journalists claims more than 300 international companies have inked confidential agreements with Luxembourg to secure lower tax rates, but new European competition chief Margrethe Vestager says the Commission has neither seen these documents nor made a decision in its investigation into such tax agreements.

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    The European Commission launched an investigation earlier this year into several member states and their tax relationships with foreign companies including Apple and Starbucks over concerns certain agreements for lower taxes could constitute illegal state aid. The case was handed to Vestager when she began her position as Commissioner on November 1.

    Nations including Luxembourg, Ireland, the Netherlands and Malta are all part of the investigation, say reports.

    In response to reports of the Consortium’s findings, Vestager said that the Commission has “not seen all the information published yesterday, and we have at this stage not yet formed an opinion about these [tax] rulings and a possible formal follow-up by the Commission.”

    The documents claim companies have used tax agreements with Luxembourg to avoid billions of dollars in taxes. Among the revelations, reports say, is FedEx’s tax rate at less than 1 percent. PepsiCo was also reported to be among the companies benefitting from tax breaks in Luxembourg despite having minimal operations in the nation.

    Full content: Reuters and The Wall Street Journal

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