Tax Policy Update - June 16, 2015

NUMBER OF THE WEEK: 15. The number of member nations now under increased scrutiny from European Union regulators who are aggressively hunting for violations of the EU's "state aid" rules. The possible violations arise from favorable tax agreements between the scrutinized nations and multinational corporations. Luxembourg, Ireland, and the Netherlands occupied the headlines in 2014 for their tax agreements with major companies — including some heavy-hitter U.S. firms. But the EU's tax dragnet is expanding, with demands for more in-depth details on tax arrangements now directed at Germany, France, and Italy, among others. If the European Commission finds a company's tax arrangement violates state aid rules, the company could be forced to pay back past tax benefits it received. These tax probes are swelling against the backdrop of the ongoing OECD Base Erosion and Profit Shifting (BEPS) project, which aims to develop a broad set of multi-lateral tax avoidance policies