Ikea accused of underpaying over €1 billion in taxes to EU

PUBLISHED : Sunday, 14 February, 2016, 5:14pm
UPDATED : Sunday, 14 February, 2016, 5:14pm

Ikea avoided paying at least 1 billion (HK$8.77 billion) in taxes owed to European nations over the past six years, the EU’s Green party said as it sought a government investigation of findings in a report it commissioned.

The Greens/EFA group in the European Parliament said the world’s biggest furniture retailer is using loopholes to avoid paying taxes, according to a February 12 statement on the party’s website.

European officials are pushing forward with probes into Apple and Amazon for tax deals they set up in Ireland and Luxembourg respectively.

The EU ruled last month that Belgium’s tax arrangements with about 35 companies, including Anheuser-Busch, were illegal and separately struck down deals involving Starbucks and Fiat.

“Ikea is just the latest example of a major multinational going to great lengths to avoid its tax responsibility,” the Greens said in a statement.

“There is also an urgent need to change the regulatory framework and environment, which facilitates corporate tax avoidance in Europe.”

The commission received the Green’s report and will study it in detail, Vanessa Mock, spokeswoman for the financial services and taxation, said.

Ikea avoided paying taxes on 84 per cent of the 14.3 billion in royalty income it received from retail outlets from 1991 to 2014, according to the Greens.

As a result, Germany missed out on 35 million in revenue in 2014 and France 11.6 million, the Greens said.

Inquires made to the Luxembourg-based offices of Ikea, seeking comment on the allegations made by the Greens, were not immediately returned.