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EU’s Vestager says not penalizing U.S. firms or U.S tax system

BRUSSELS – Europe’s antitrust chief on Monday rebuffed U.S. criticism of her pursuit of Apple, Amazon and other U.S. companies over their tax deals, saying she was just doing her job to ensure a level playing field in the 28-country bloc.

Competition Commissioner Margrethe Vestager’s comments came after U.S. Treasury Secretary Jack Lew earlier this month urged her to reconsider her investigations because they risked creating disturbing precedents.

“The Commission is using a combination of its tools, namely legislative action and enforcement of EU state aid rules, with the aim of establishing fair tax competition within the European Union,” Vestager wrote in a letter to Lew seen by Reuters.

She said her investigations were not intended to challenge the U.S. tax system or bilateral tax agreements.

“The Commission has the duty to ensure that these rules are applied in a non-discriminatory manner by excluding preferential treatment in any form that constitutes incompatible state aid,” Vestager said. “This does not put into question the U.S. taxation system or go against double taxation treaties concluded by EU member states.”

She said ordering governments to recover back taxes was just part of the bloc’s rules and was not intended to punish companies.

The European Commission is investigating Apple’s tax deal with Ireland and those between Amazon and McDonald’s in Luxembourg to see if they give an unfair advantage in breach of state aid laws.

Both Starbucks and Fiat Chrysler Automobiles face back taxes of up to 30 million euros. Apple Chief Executive Tim Cook last month personally lobbied Vestager.

Vestager said just a handful of U.S. companies had to repay illegal state aid out of about 170 cases since 1999.

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Meet Paul Raymond

Meet Paul Raymond

Mr. Raymond is a sought after speaker in tax controversy law by many attorney, accountant, and business groups and at the request of the Internal Revenue Service, has presented programs at the IRS Nationwide Tax Forum, attended by tax professionals throughout the United States.

Additionally, he continues to be an active member in the Section of Taxation, American Bar Association, where he was the Past Chair of the Employment Taxes Committee.

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