EU delays decisions on Apple, Amazon tax probes
BRUSSELS–The European Union won’t meet a self-imposed June deadline for deciding whether four multinational companies including Apple Inc. and Amazon.com Inc. benefited from illegal tax sweeteners, the bloc’s antitrust chief Margrethe Vestager said Tuesday.
“We won’t meet the deadline we set ourselves [of] the end of the second quarter,” Ms. Vestager told European lawmakers at a hearing Tuesday. She said she wouldn’t give a new deadline for finalizing the cases.
The EU has opened a series of high-profile probes in recent months into tax deals struck by four multinationals–Apple in Ireland, Amazon and Fiat SpA in Luxembourg and Starbucks Corp. in the Netherlands. Ms. Vestager had pledged to reach a decision by the end of June as to whether the deals violate EU law, which could be followed by significant back-tax demands.
The investigations have been a priority for the EU’s executive arm at a time of deep national austerity, as governments across the continent seek to shore up their finances and demonstrate to taxpayers that wealthy multinationals are paying their fair share of tax. EU regulators have no authority to impose tax policy on the bloc’s 28 governments, but they are using an EU-wide ban on selective state aid to companies to crack down on individual tax deals that they deem to have given an unfair advantage to certain enterprises.
Ms. Vestager attributed the delay to difficulties in obtaining information from the countries involved. Luxembourg had resisted the commission’s requests for tax documents until late last year and was fighting the case in court. But the country’s prime minister Xavier Bettel agreed in December to share information on tax deals secured by multinational companies, after the commission also asked other EU countries to share their tax rulings.
“Obviously fast is better than slow, but better than all is being just,” Ms. Vestager said.
The commissioner said she was also examining concerns from trade unions over Luxembourg’s tax dealings with McDonald’s Corp. “We are looking into the information…to assess if there is a case,” she said.
Ms. Vestager said she wouldn’t hesitate to open further investigations if she suspected that the bloc’s rules were being violated. “We cannot do every case in the world but we can find cases that we think [are] deeply problematic,” she said.
The EU’s executive arm “is committed to this agenda and we will do our best to tackle corporate tax avoidance within the EU,” she said. Part of the rationale for the tax investigations is to “inspire” national governments to change their legislation, as Ireland has in eliminating the double-Irish tax loophole, she added.
