French gas giant under tax probe
THE EU has launched an in-depth probe into alleged sweetheart tax deals between French gas group Engie and Luxembourg, taking on a major European multinational after similar high-profile investigations into US giants.
“The commission has concerns that several tax rulings issued by Luxembourg may have given GDF Suez [now Engie] an unfair advantage in breach of EU state aid rules,” the European Union’s executive arm said.
The probe comes days after the commission angered Washington with a ruling that US tech icon Apple had received favourable tax terms that amounted to state aid and ordered it to repay 13 billion euros (US$15 billion) in back-taxes in Ireland.
“We will look carefully at tax rulings issued by Luxembourg to GDF Suez,” EU Competition Commissioner Margrethe Vestager said in a statement.
“They seem to contradict national taxation rules and allow GDF Suez to pay less tax than other companies,” she added.
The commission said Luxembourg is suspected of having afforded Engie subsidiaries different tax treatments for similar types of transactions, lowering the company’s overall tax exposure significantly.
The tiny EU nation has been under intense scrutiny since the LuxLeaks revelations showed that current European Commission President Jean-Claude Juncker gave companies huge tax breaks while he was Luxembourg prime minister. –