The judgments of the General Court of the EU – on whether unlawful state aid purportedly granted by the Netherlands and Luxembourg to Starbucks and FIAT – are the first time that an EU court decided on the substantive aspects of two of the pending individual tax ruling cases. The decisions reconfirm the Commission’s authority to determine whether state aid in the form of a tax benefit has been granted including the testing of whether the transfer prices for intra-group transactions agreed upon in the tax ruling are a sufficiently reliable approximation of market prices. Interestingly the General Court reviews extensively the Commission’s transfer pricing assessment and how to allocate the burden of proof (with the Commission losing in Starbucks and winning in FIAT). Further some features of the judgments could have wider implications for other pending cases and in general for taxpayers...
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The judgments of the General Court of the EU – on whether unlawful state aid purportedly granted by the Netherlands and Luxembourg to Starbucks and FIAT – are the first time that an EU court decided on the substantive aspects of two of the pending individual tax ruling cases. The decisions reconfirm the Commission’s authority to determine whether state aid in the form of a tax benefit has been granted including the testing of whether the transfer prices for intra-group transactions agreed upon in the tax ruling are a sufficiently reliable approximation of market prices. Interestingly the General Court reviews extensively the Commission’s transfer pricing assessment and how to allocate the burden of proof (with the Commission losing in Starbucks and winning in FIAT). Further some features of the judgments could have wider implications for other pending cases and in general for taxpayers...
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