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EU opens investigation into tax treatment of Inter Ikea

12.01.2018 − 

In mid-December 2017, the EU Commission opened an in-depth investigation into the tax paying procedures of Netherlands-based Ikea company Inter Ikea Holding. According to EU Competition Commissioner Margrethe Vestager, it is possible that Inter IKEA may have acquired an unfair advantage via two Dutch advance tax rulings dating back to 2006 and 2011.

Artificially shifting profits to certain EU Member States should, however, not lead to a reduction in tax burden; such a reduction would be a classified as a breach of the EU State aid provisions. Consequently, Vestager has announced the intention to conduct scrupulous investigations into the tax treatment of Inter Ikea in the Netherlands.

According to an EU Commission statement published on 18 December, this investigation affects the tax treatment of Inter Ikea Systems, which belongs to the Inter Ikea Group, and which collects the Ikea franchise fees from all Ikea shops worldwide. This Ikea franchising model has been used since the early 1980s and means that all Ikea shops pay a franchise fee of 3% of their turnover to Inter IKEA Systems. In return, the shops are able to use the Ikea trademark and also use the product and sales concept developed by Ikea.

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