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State aid decisions delayed

printer Mail

The European Commission has confirmed that it will not meet its self-imposed June deadline for its state aid investigations into tax rulings involving multinationals like Amazon, Apple, Fiat and Starbucks. EU competition commissioner Margrethe Vestager told a hearing at the European parliament on 5 May: ‘We do not necessarily get the information that we ask for the first time, not necessarily the second time either. Therefore, we will not meet the first deadline that we set ourselves to be done by the end of second quarter,’ adding the EC would not ‘sacrifice the rule of law or the quality of our work to speed up the process’.

Vestager confirmed there were five tax ruling cases open against four different member states. She also stated that the Commission was considering opening a state aid case against US fast food corporation McDonald’s, after a coalition of European and American trade unions alleged in a report (Unhappy Meal: €1bn in tax avoidance on the menu at McDonald’s) that McDonald’s ‘avoided tax’ by moving its European headquarters to Switzerland, thus ‘paying an effective tax rate of only 0.48%’, and shifted €3.7bn (£2.7bn) of revenues through the use of royalty payments into a Luxembourg subsidiary which had only 13 members of staff.