EU News
Printable version

Statement by Executive Vice-President Margrethe Vestager following today's Court judgments on the Amazon and Engie tax State aid cases in Luxembourg

Statement given yesterday by Executive Vice-President Margrethe Vestager following the Court judgments on the Amazon and Engie tax State aid cases in Luxembourg.

“All companies should pay their fair share of tax. Tax advantages given only to selected multinational companies harm fair competition in the EU. They also deprive the public purse and European citizens of funds for much needed investments to recover from the coronavirus crisis and seize the twin transitions.

“Today, the General Court has delivered two judgments. It has confirmed the Commission's June 2018 decision that Luxembourg granted illegal State aid to Engie through selective tax breaks, but it annulled the Commission's October 2017 decision that Luxembourg granted illegal State aid to Amazon.

“Both judgments confirm once more a key principle: while Member States have exclusive competence to determine their taxation laws, they must do so in respect of EU law, including State aid rules.

“As regards Engie in Luxembourg, the General Court has confirmed the Commission's decision that a set of tax rulings issued by Luxembourg artificially reduced Engie's tax bill by around €120 million. The tax rulings endorsed two financing structures put in place by Engie that treated the same transaction both as debt and as equity, with the result that its profits remained untaxed. The General Court has also confirmed that State aid enforcement can be a tool to tackle abusive tax planning structures that deviate from the objectives of the general tax system.

“As regards Amazon in Luxembourg, the Commission's decision concerned a tax ruling issued by Luxembourg to Amazon, by virtue of which three quarters of the profits made from all Amazon sales in the EU went untaxed until 2014. We will carefully study the judgment and reflect on possible next steps.

“The Commission is using all tools at its disposal to fight unfair tax practices. State aid enforcement works hand in hand with the EU's legislative action to address loopholes and ensure transparency in fiscal matters. We are close to achieving a historic global agreement on the reform of the international corporate tax framework. Moreover, the Commission is in the process of putting forward a proposal for a digital levy, so that companies benefiting from the digital Single Market fairly contribute to the EU budget. We need to seize the momentum to progress towards fair taxation at all levels."

Click here for the full press release

 

Original article link: https://ec.europa.eu/commission/presscorner/detail/en/STATEMENT_21_2468

Share this article

Latest News from
EU News

Free, Secure, Compliant UK Public Sector IT Recycling Service