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EU opens probe into Belgium tax deals for multinationals

Published on 03/02/2015

The EU opened an investigation on Tuesday into tax deals that Belgium may be granting multinational firms, the latest in a widening probe into sweetheart tax arrangements across Europe.

Competition commissioner Margrethe Vestager said Belgium’s system was believed to breach European Union rules on unfair state aid, adding that it “appears to grant substantial tax reductions only to certain multinational companies.”

“If our concerns are confirmed, this generalised scheme would be a serious distortion of competition unduly benefitting a selected number of multinationals,” Vestager said.

She declined to name the companies involved.

The commission, the EU executive arm, said the Belgian tax provision allows companies to reduce tax by registering “excess profits” that allegedly result from the advantage of being part of a multinational group.

EU regulators charged Luxembourg last month with giving illegal tax breaks to Internet shopping giant Amazon.

It followed last year’s “Luxleaks” scandal, which revealed details of tax breaks given to dozens of major firms while current Commision President Jean-Claude Juncker was prime minister of Luxembourg for 19 years.

The EU has also launched investigations into US tech giant Apple’s tax deals with Ireland, coffee-shop chain Starbucks with The Netherlands and Italian automaker Fiat, also with Luxembourg.