EU to use 'LuxLeaks' documents in tax probe

20th November 2014, Comments 0 comments

The EU said Thursday it will use the so-called "LuxLeaks" documents to decide whether to widen its probe into Luxembourg's tax deals, in a row that has embroiled new European Commission head Jean-Claude Juncker.

A journalistic investigation using thousands of leaked files revealed this month that Luxembourg allowed hundreds of top companies -- including Apple, Pepsi, IKEA and Heinz -- to enjoy tax breaks while Juncker was prime minister.

Brussels already had two inquiries under way against Luxembourg for its tax deals with Internet shopping giant Amazon and the legal arm of Italian motor firm Fiat, and had said further investigations were a possibility.

But EU anti-trust chief Margarethe Vestager confirmed for the first time Thursday that the Commission would examine the LuxLeaks papers as evidence in its decision whether to broaden the investigation.

"We consider the LuxLeaks documents as market information, we will examine it and also therefore evaluate whether or not this will lead us to open new cases," Denmark's Vestager told a news briefing in Brussels.

Vestager also said that results of the current Amazon and Fiat probes, as well as investigations into Ireland's deals with tech giant Apple and the Netherlands' arrangements with coffee chain Starbucks, were expected by the middle of 2015.

Her portfolio includes the tax breaks as they are perceived as possibly breaking the 28-nation European Union's state aid rules.

The US-based International Consortium of Investigative Journalists (ICIJ) carried out a six-month investigation of 28,000 leaked documents, the results of which were published in newspapers around the globe on November 5.

Juncker, who took office on November 1, faces a confidence vote in the European Parliament next week over the fact that the tax breaks were introduced during his 19 years at the head of Luxembourg's government.

The "Luxleaks" documents showed that billions were funnelled through Luxembourg thanks to complex financial structures that allowed companies to slash their tax liabilities, depriving hard-up governments of revenue.

Juncker said last week he would push for harmonisation of tax rules across the EU and denied he was a "best friend of big business."

© 2014 AFP

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