The trepidation is exemplified by the very low adjustments the EU Commission found, after its nearly year of investigation.
The adjustments are enough to be noticed by the EU state authorities and the companies, but de minimis in the context of corporate annual profits, corporate profit accumulation over time (e.g. perpetual deferral), corporate tax reserves, and de minimis in the context of revenue collection for either The Netherlands or Luxembourg.
Starbucks’ potential 30 million Euro re-capture tax bill by The Netherlands (EU Commission required), dating back to accumulation from 2008, will, assuming the tax bill stands after Starbucks’ appeal and after Starbucks’ challenge the decision up through the EU Court Of Justice, be offset by a US tax credit of like amount.
Consequently, the low adjustment is a wash out, albeit could require a cash flow payment in the nearer future than the perpetual one under US tax deferral accounting. 30 million Euro is too small to be noticeable to Starbucks shareholders or to the US Treasury, especially when the tax credits are applied. By William Byrnes, Texas A&M University Law – EU Commission State Aid Starbucks Decision – My U.S. Perspective | Kluwer International Tax Blog
- A Mysterious Study in the Code of Conduct Report 1999 and a Rumoured French Connection
- Tax advantages for Fiat and Starbucks are illegal under EU state aid rules
- Starbucks and Fiat Chrysler’s tax avoidance deals to be ruled illegal |The Guardian
- Anticipate, prepare for and lead change
- Tax rulings and other measures similar in nature or effect
- BEPS 2015 Final Reports
- BEPS and Indirect Tax