Brussels, 08/02/2016 (Agence Europe) - The Belgian Finance Minister, Johan Van Overtveldt, announced on Friday 5 February that Belgium was to appeal against the decision of the European Commission to the effect that the Belgian excess profit rulings scheme constitutes illegal state aid (see EUROPE 11465).
On 12 January of this year (see EUROPE 11465), the Commission ordered Belgium to recover around €700 million from 36 businesses which benefited from the system, through 66 tax rulings. As the Belgian press agency Belga reports, the legal foundation for the appeal will be looked into.
Under this system, the profit actually recorded by a multinational is compared to the hypothetical average profit of an independent company in a comparable situation. The resulting difference in profit is considered excess profit and the company's tax base is reduced proportionately.
The Commission firstly pointed out that this scheme is selective in nature and also dismissed Belgium's argument that the reductions are necessary to avoid double taxation. The Commission explains that these adjustments were made by Belgium unilaterally. The regime did not require the companies to prove that they had actually been taxed twice, or even that there was a risk of double taxation.
Luxembourg has already announced its intention to appeal against a similar decision of the Commission over tax ruling granted to Fiat Finance and Trade, as has the Netherlands regarding Starbucks. (Original version in French by Elodie Lamer)