Unauthorised state aid

In December 2014 the European Commission announced inquiry into tax rulings practises in all EU member states. Now in October 2015 the European Commission concluded that the tax benefits granted to the Fiat Company in Luxembourg and Starbucks Company in Netherlands are incompatible with the EU state aid rules. In both cases it was found that prices for which the companies sold goods and services in group haven’t reflected economic reality. Thereby the companies gained advantage over competitors. Most of the profits of Starbucks Company have been shifted abroad, where they were also not taxed. Fiat Company only taxed small part of its real profit. European Commission concluded that in both cases the tax ruling issued by the Dutch and Luxembourg authorities unduly reduced company’s tax burden by €20 - €30 million. The European Commission ordered Luxembourg and Netherlands to end this tax treatment and claim back the advantages granted to Starbucks and Fiat companies.