The European Commission hopes to have ready by fall proposals for multinational companies operating in the EU that tightens up rules on tax bases.
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“The picture of Ireland painted by the Commission in its decision, as a country prepared to play fast and loose with the law to gain unfair advantage, could not be more damaging or further from the truth”, Irish Prime Minister Enda Kenny told lawmakers.
The ruling follows “a global, worldwide approach” defined by both the Group of 20 countries and Organization for Economic Cooperation and Development, Moscovici said.
“I would hope that the idea that a European Commission action will reach into our tax base and take U.S. tax revenues and make them European tax revenues will help trigger this debate about tax reform”, Lew said in a talk at the Council on Foreign Relations.
The European Commission’s probe into Apple’s tax rulings from Ireland was prompted by an investigation by United States authorities, European Commissioner for Competition Margrethe Vestager has said.
The European Commission didn’t decide that there was a problem “from scratch”, the commissioner said. “We are, of course, respecting that, although it’s a odd decision in a way to say that I don’t want your 13 billion euros when you could have some social programs or economic programs in a country which has been damaged by the crisis”, he said. And his focus was in pointing out the need for reform of the USA system. “U.S. companies could claim foreign tax credits against their US tax bill for any tax-related payments to European Union member states”.
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Vestager said the ruling against Apple’s tax arrangements was based on facts, as were its state aid decisions on rulings from authorities in the Luxembourg, the Netherlands, and Belgium. She said that “there is nothing to stop European Union governments from deciding to apply a low tax rate to everyone”. “In the case of Apple, just remember that this company paid 1 percent for its tax in 2003 and 0.005 percent in 2014”, he said. “No more tax evasion, no more tax fraud, no tax avoidance, no more aggressive tax planning”.
