Starbucks, Fiat must repay EU millions in tax breaks

The two companies will have to repay up to €30 million in tax breaks

Starbucks have brought out a new snack (REuters)

Starbucks and Fiat are facing millions in unpaid tax bills after the European Comission ruled that deals between the two companies and the EU nations did not comply with EU tax rules.

The two companies will have to repay up to €30 million in tax breaks to the authorities following the ruling.

Margrethe Vestager, the EU antitrust commissioner, said that the ruling supported the notion that “all companies, big or small, multinational or not, should pay their fair share of tax”.

She added that the Netherlands will have to recoup the unpaid taxes from Starbucks and Luxembourg from Fiat.

Earlier this year, the EC said that Starbucks may have avoided taxes when one of its Dutch units paid millions of euros to a UK-based arm of the company for a technique to roast coffee beans. Starbucks said at the time that it complied with all tax rules.

The EC has also questioned Luxembourg’s arrangement with one of Fiat's units, Fiat Finance & Trade.

Brussels is cracking down tax arrangements between multinationals and national governments to try and get rid of so-called sweetheart deals.

Similar deals between Amazon and Luxembourg and Apple in Ireland are also under scrutiny as part of an EU-wide investigation in the tax practices.

Additional reporting by Reuters