European Union regulators will soon publish their preliminary findings over whether tax deals granted to Fiat, Starbucks, and Apple violated EU law. This is just the next step in the EU’s drive against the alleged tax avoidance by multinational companies. The European Commission opened its investigations in June to see if tax deals granted to Starbucks Corp. in the Netherlands, Fiat Finance and Trade in Luxembourg, and Apple in Ireland were illegal state support. The commission will publish its opening finding perhaps as soon as tomorrow and Apple will have 30 days to respond. The Commission could eventually order the companies to return any unpaid taxes. It’s not clear at this time how much in taxes would be owing, if any.
The tax rulings, given to multinationals by governments on how to calculate a specific tax, would be found illegal if they gave an advantage to some companies. The companies themselves are not under investigation but they will have the chance to give input, particularly because they would be required to pay any unpaid taxes.
In the three cases being investigated, the EC is concerned that national tax authorities permitted Apple, Fiat, and Starbucks to underestimate their taxable profits, which gave them an unfair advantage over their competitors.
