Photographer: Jason Alden/Bloomberg

Netherlands Fights EU Tax Order on Starbucks for More Clarity

  • EU decided Dutch fiscal deal for coffee company was illegal
  • Dijsselbloem says decision is about a ‘very small’ case

The Netherlands is fighting the European Union over its decision that a tax arrangement with Starbucks Corp. was illegal and forced it to claim back millions in unpaid taxes from the U.S. coffee company.

The European Commission’s Oct. 21 decision gave a preview of what may be in store for Apple Inc. and Inc., which are also embroiled in the EU tax probe looking into some 300 such fiscal deals across the bloc. The EU regulator’s decision against the Netherlands, forcing Starbucks to pay back as much as 30 million euros ($32.7 million), wasn’t justified, said Dutch Finance Minister Jeroen Dijsselbloem.

“We feel that we have applied international standards that have been developed in the OECD and the commission says we should have applied different standards or in a different way,” Dijsselbloem told reporters Friday as he attended a meeting with his European counterparts in Brussels. “The only thing I want is to have absolute clarity on that so that the Netherlands and other countries understand how they should act when they impose taxes.”

Luxembourg and the Netherlands are the first countries to challenge the commission over its decisions last year that the fiscal deals they concluded with Fiat Chrysler Automobiles NV and Starbucks, respectively, were illegal.

The appeals were filed at the EU’s lower court in Luxembourg last month and any decision, which may take more than two years, will set a precedent for other pending investigations at the EU. The regulator on Jan. 11 ordered Belgium to recover about 700 million euros in illegal tax breaks given to at least 35 companies as part of its continued crackdown on tax avoidance.

“The Starbucks case is actually very small -- it’s only about the burning of the beans,” Dijsselbloem said in Brussels Friday. “It’s also about a small sum according to the commission, we should have collected about 20 to 30 million euros more. So it’s quite small.”

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