Declaring open season on tax evaders, one EU Commissioner is going up against the multinationals, but she has been accused of changing the rules of the game.
She is said to be the model for Prime Minister Birgitte Nyborg in the popular Danish TV series Borgen.
I think it is very important that we talk about what the 27 now want.EU Commissioner for Competition
In fact Margrethe Vestager was Economy minister before leaving Copenhagen for the European Commission in Brussels to take on the Competition brief.
This non-mainstream, high-profile politician is now leading the war against the biggest companies in the world over tax evasion in Europe.
Efi Koutsokosta euronews –
“Google, Starbucks, Amazon, Gazprom and now you just handed a record bill of 13 billion euros to Apple for unpaid taxes in Ireland. This has triggered a lot of reactions from the United States as well. Could we speak about a conflict of interest?”
Margrethe Vestager, EU Commissioner for Competition
“No I don’t think so. Because when it comes to what you could call a global tax community, the European Union and U.S. are on the same page. Because we share sort of the very basics. It’s not just that most companies should pay their taxes but that all companies should pay their taxes.”
euronews – “There are some member states such as Ireland, the Netherlands or Luxembourg which give incentives to many companies to attract investment to Europe. And now you say, “Stop that”. Why now?”
Vestager – “I still think that countries have a lot of room to compete in terms of attractiveness. You still have the very low corporate tax in Ireland, 12.5% compared to other countries with 20%, or 22%, and something like that is completely fairly protected by the treaty. You can set your own corporate taxation. But it’s another thing to give a sort of selective benefit open to one company, so that this company does not pay the same amount of taxes as everyone else. I think that’s a completely different ball game.”
euronews – “So you think that this is illegal?”
Vestager – “Yes, we think that the way Apple has paid taxes has taken a form of illegal state aid.”
euronews – “But they say, and the CEO of Apple said, that this is a political plan by the EU Commission and it seems that the Commission has now started really opening up cases.”
Vestager – “But the thing is that all our cases can be appealed against in the European Courts. And the courts will hear nothing of politics or attitudes or feelings in your stomach or whatever. They want the facts of the case. They want to see the case law, they want to hear our interpretation of court practice. And that of course keeps us in a very straight, narrow road in order to get a solid case. Because we know that we might be severely challenged. And therefore politics has no place here.”
euronews – “Is it a political plan by this EU Commission to close the tax havens in the European Union?”
Vestager – “What is our ambition is that profits are being taxed where profits are being generated. In a country where companies serve their customers, sell their products depending on the quality, the price, the services that they can give and that this is the business model. Because if profits are shifted around from a high-tax country to a low-tax country maybe, or even to a no-tax country, then how can other businesses compete? And how can citizens rely on a fair market to work for them?”
“So what are the next steps on your side of the argument?”
Vestager – “Well, we have tvo cases pending which is the case of Mc Donalds and a case against Amazon and of course we are going to do the work of those cases as thoroughly and in as dedicated a way as we did before, in order to see if there are facts to support a case. And that of course remains to be seen.”
euronews – “Do you see any political responsibilities for the member states which made all these sweetheart tax deals with companies?”
Vestager – “Actually the thing is that I don’t deal with the shame and blame. What we try to do is to restore the level playing field, so that unpaid taxes are being recovered. It’s just like if you had a pile of cash in your hand that will be recovered if it’s illegal. So, this is not for us. And I think the important thing is of course change for the future. That in the future we should have fewer and fewer selective benefits and more and more general rules in order for companies to compete on fair terms.”
“Let’s speak about Europe now. How do you see Europe after Brexit?”
“I think it is very important that we talk about what the 27 now want. Because of course around the referendum we all talked about the UK. Everything was about the UK. I think it’s very important that we also talk about ourselves. The 27 who are here. Well, yes, this is a new situation. How can we make the best of it? Because a lot of people feel constrained. And I think fear for their jobs and they worry if their children can make it. Will they find a job? Even though they make an effort and they take an education can they then find a job? And that I think is very much down to earth, very concrete and we have to work on that with the member states.”
euronews – “Is the European Union united right now? Because we see all these crises, and the refugee crisis was of course on the top of that, divided the member states. Do you think that we should forget the EU as we have known it until now?”
Vestager – “No. Why? I just think that we should keep building. Maybe redecorating here and there, maybe sometimes adding things or sometimes closing down some rooms but it’s a very nice house to live in.
I think one of the specialities of Europe is that we are both, at once. We are both a number of countries with very strong national identities with our languages, cultures, and with the ways things are done, also political cultures, and at the same time we have a lot in common.
We are all Europeans. We share history, we share an ambition for the future which is very concrete. That individuals actually can live a life where they enjoy their rights and can pursue their dreams. And that they can see their children thrive. And that I think is the balance that we always have to keep. And this is European. It’s not the way of the U.S. or Asian countries or African countries. This is truly European; we don’t necessarily unite in that way but it is a part of the picture that we are different.”
euronews – “So, a personal question. You came from Denmark to Brussels, you were a high profile politician there. How has your life changed?”
Vestager – “Well, in a number of ways. I have had the time to discover Brussels and it’s a very nice and liveable city, it’s very green but my life has changed in a sort of a down-to-earth way, in that I am afraid to bike here and I miss the water, but that being said it’s a very nice place to live.”