Taxation: Brussels launches the offensive against Ikea, the giant furniture replica

The european Commission has opened on Monday 18 November, an investigation against the Swedish Ikea, the world’s number one furnishings, that are suspected of having received undue tax advantages of the netherlands. “We will conduct a thorough review of the tax treatment that the netherlands have applied to Inter Ikea”, the company that operates the activity of the franchise of Ikea, announced the eu executive in a statement.

The european Commission fears that the group, Inter Ikea has obtained “tax benefits, which may not benefit from other companies subject to the same tax rules in the netherlands”. If this is the case, this would be contrary to the principle of competition, which the Commission is the guardian from across the EU. “All companies, large or small, multinational or not, must pay their fair share of taxes. The member States may not allow certain companies to pay less tax by allowing them to transfer artificially their profits elsewhere,” said european Commissioner Margrethe Vestager, quoted in a press release.

Ikea is defended on Monday to receive undue tax advantages in the netherlands after the opening of an investigation by the european Commission, claiming to be imposed “in accordance with the rules of the EU”. “The way we have been taxed by the national authorities has been consistent, from our point of view, to the rules of the EU”, said Ikea in a statement to AFP, saying it was willing to “cooperate and respond to questions from the Dutch authorities and the european Commission”.

The Swedish giant insists on the fact that Inter Ikea Group, including its Dutch subsidiary Inter Ikea Systems B. V., owner of the brand, is committed “to pay taxes in compliance with the laws and regulations” wherever it is present.

“The strategy of aggressive tax planning”

This survey follows a report published by meps of the greens in February 2016, in which they had denounced “the policy of aggressive tax planning” from the Swedish. The latter, which had prompted Ms. Vestager and its counterpart european taxation, Pierre Moscovici, to launch an examination procedure to check the existence of a possible infringement of the european legislation on the competition, welcomed the decision of the Commission.

“It is a great success for the Greens because it is we who are at the origin of this investigation,” responded to AFP Sven Giegold, mep environmentalist and specialist in tax issues. “The netherlands will co-operate fully with the european Commission to assist them in their investigation,” promised a senior Dutch in Brussels, in a statement to AFP.

Ikea has completed in 2015-2016 a record-high profit of 4.2 billion euros and its sales close to 40 billion. Via a complex structure, the set is entirely controlled by the family of the founder, Ingvar Kamprad, a billionaire 91-year-old who had started his business in 1943 in the countryside of sweden. Today, there are more than 400 stores in fifty countries.

(with AFP)

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