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EU regulators open investigation into Ikea's Dutch tax deals

Staff Writer |
EU state aid regulators will investigate whether Swedish furniture retailer Ikea's tax arrangement with Dutch tax authorities helped cut its tax bill.

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This marks the latest crackdown on unfair tax deals between multinationals and EU countries.

The European Commission said it was looking into two tax rulings issued to Inter Ikea.

This operates Ikea's franchise business and collects a franchise fee of 3% of turnover from all Ikea shops via its subsidiary Inter Ikea Systems in the Netherlands.

"All companies, big or small, multinational or not, should pay their fair share of tax. Member states cannot let selected companies pay less tax by allowing them to artificially shift their profits elsewhere," European Competition Commissioner Margrethe Vestager said.

The Commission said the first tax ruling, which covered 2006 to 2011, resulted in a significant part of Inter Ikea Systems' franchise profits shifting to a Luxembourg unit where it was not taxed.

A 2011 ruling, brought in after the Commission declared the first deal illegal, allowed a substantial part of the company's franchise profits after 2011 to be transferred to its Liechtenstein parent.

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