Unions Blast Loopholes in New EU Tax Avoidance Proposals
A collective of unions has slammed the latest proposals by the European Commission to stamp out elaborate tax plans used by multinational companies to move vast profits around the EU in an effort to reduce their corporate tax bills in member states.
The European Commission last week published a series of proposals to stamp out such schemes – including legally-binding measures to block the most common methods used by companies to avoid paying tax. It also proposed a recommendation to Member States on how to prevent tax treaty abuse and a proposal for Member States to share tax-related information on multinationals operating in the EU.
It followed investigations by the European Parliament and the European Commission. In January 2016, the European Commission branded the Belgian “excess profit” tax scheme illegal under EU state aid rules and ordered the country to recover the US$760 million unpaid tax from the companies concerned, most of which are major multinationals.
In October 2015, the Commission ruled that Luxembourg and the Netherlands have granted selective tax advantages to Fiat and Starbucks, respectively. The Commission also has three ongoing in-depth investigations into concerns that tax rulings may give rise to state aid issues, concerning Apple in Ireland, Amazon in Luxembourg and McDonald’s in Luxembourg.