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Starbucks, Fiat to repay illegal tax advantages
http://www.dw.com/en/starbucks-fiat-to-repay-illegal-tax-advantages/a-18794830US coffee retailer Starbucks and the financing arm of Italian carmaker Fiat must repay several millions of euros in illegal tax advantages. The ruling is part of an EU clampdown on corporate tax avoidance.
Starbucks, Fiat to repay illegal tax advantages
21.10.2015
EU Competition Commissioner Margrethe Vestager announced Wednesday that tax rulings which "artificially reduce a company's tax burden" were illegal because they were "not in line with EU state aid rules."
As a result, the EU Commission ordered the Netherlands and Luxembourg to recover the illegal tax benefits from Starbucks and Fiat, respectively. The Commission estimated that each company could owe up to 30 million euros ($34 million), but said the precise amounts would have to be determined by authorities in the Netherlands and Luxembourg.
The EU Commission found that Starbucks in the Netherlands and Fiat's financing arm in Luxembourg used "artificial and complex methods" that "do not reflect economic reality" and thereby "unduly reduced" the taxes paid by the two companies.
Such an approach gave companies "an unfair competitive advantage over other companies, typically small and medium enterprises," the Commission added.
