Illegal Fiscal Aids or Advance Tax Rulings? Insights and PRedictions from Starbucks and FIAT

Countries from all over the world have traditionally relied on tax breaks to attract investments by multinational companies. Lately, some international tax competition practices have been attracting increasing criticism. In the US, for example, political opposition has prompted Amazon to give up $3 billion in promised tax breaks for its planned HQ2 in New York. In the European Union, instead, it is the European Commission that has taken the lead against the tax advantages granted by some EU Member States to lure in multinationals. The “European Tax Rulings Saga” comprises a number of decisions by the European Commission enjoining certain EU Member States to recover over €15 billion of fiscal aids allegedly granted to multinationals such as Amazon, Apple, FIAT, and Starbucks in the form of “Advance Tax Rulings”. Those decisions have all been appealed before the Court of Justice of the European Union. In September 2019, the EU first-instance judges annulled the Starbucks decision, upheld the FIAT decision and heard the oral arguments in the Apple case. What can we infer from Starbucks and FIAT? Which party is currently leading the match? Which party will eventually come out on top? This talk by Amedeo Arena (Federico II Law School), moderated by Stephen Shay (Harvard Law School), will endeavor to provide an answer to those questions and to examine the impact that the “European Tax Rulings Saga” may have in the field of corporate taxation within and beyond the EU.