Corporations can escape death for as long as they make a profit — but they still have to pay their taxes, the European Commission has ruled in two cases involving Apple and Amazon.com. At the same time, the Commission has unveiled reforms to the way value-added tax (VAT) is collected that will affect businesses selling online across the EU.
Two decisions published Wednesday could have consequences for multinationals operating in Europe and seeking to optimize the rates of corporation tax they pay by allocating profits to entities not directly involved in the provision of the goods or services to which the profits relate.
Last year, the Commission, the European Union’s antitrust and competition watchdog, ordered the Irish government to recover a staggering €13 billion in back taxes that it said Apple should have paid. On Wednesday it took the country to court for failing to make Apple pay.
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