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Tax decision shows Brussels “playing to the gallery”

22 Oct 2015

The Institute of Directors has accused the European Commission of “playing to the gallery” and misusing its powers after it decided that the tax treatment of Fiat and Starbucks by the Netherlands and Luxembourg was illegal under state aid rules.

Allie Renison, Head of EU and Trade Policy at the IoD, criticised the decisions:

“The European Commission seems to be to playing to the gallery in their response to public agitation over the tax affairs of big multinational companies, using powers which were not designed for the purpose. State aid rules are there to prevent governments from protecting certain companies to the detriment of competition, and the Commission has made a very political move by using them to retrospectively attack the tax systems of two member states.

“These decisions will create confusion with the international tax rules. The EU should instead await the roll out of the OECD and G20 international tax principles, rather than take unilateral and backwards-looking action. Businesses need clarity, not confusion about their obligations. By acting in this way, Brussels is not helping EU members become more globally competitive.”

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