“We are committed to further develop our business in Europe and look forward to the continued dialogue on how to develop a harmonized and clear global tax system”, it added.
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The Greens/EFA group in the European Parliament said the world’s biggest furniture retailer was using loopholes to avoid paying taxes, according to a Feb 12 statement on the party’s website.
The report claims that the division of Ikea into two distinct corporate groups based in Liechtenstein and the Netherlands in the early 1980s has masked “large scale profit-shifting” by the company.
According to the newspaper, the crux of Ikea’s tax construction is in the division of the group.
Ikea avoided paying at least €1 billion (HK$8.77 billion) in taxes owed to European nations over the past six years, the EU’s Green party said as it sought a government investigation of findings in a report it commissioned.
The report alleges Ikea knowingly engaged in profit shifting, or moving billions of euros in profit from highly taxed countries like Britain, France and Germany into subsidiaries or unnamed recipients in countries like Lichtenstein or Luxembourg, where the company would pay little to no taxes.
Questioned by AFP about the report MEPs, Ikea said “pay taxes in accordance with national and global legislation”, in an email. “We have a strong commitment to manage our operations in a responsible way and to contribute to the societies where we operate”.
“In the 2015 financial year, the IKEA Group corporate income tax was 822 million euros on a global basis, with an effective corporate income tax rate of approximately 19 percent”, it added.
The top regulator in the European Union, the European Commission, said it would study this report.
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Since LuxLeaks scandal broke out in November 2014, which had deeply damaged the inauguration of Luxembourg Jean-Claude Juncker as the new President of the Commission, Brussels stepped up its fight against tax opacity.
