IKEA accused of dodging a billion euros in taxes

Between 2009 and 2014 Ikea evaded at least 1.032 billion euros in tax using a complicated construction with companies in the Netherlands, Belgium, Luxembourg and Liechtenstein. Most of the tax money disappears via the Dutch subsidiary Inter Ikea Systems, the Volkskrant reports based on calculations by The Greens/European Free Alliance in the European Parliament. In 2014 alone 179 million euros in tax money from EU countries disappeared through the Dutch subsidiary. Germany lost out the most with 35.6 million euros tax evaded by Ikea in the country in 2014, followed by France with 23.8 million and the United Kingdom with 11.6 million. According to the newspaper, the crux of Ikea's tax construction is in the division of the group. The group is divided into two parts - the Ikea Group, which operates 328 stores, and the Inter Ikea Group, which owns the factories and product development. The Ikea Group pays 3 percent of their revenue to Inter Ikea Group in order to operate under the Ikea name. This means that their taxable profits are much lower. The Inter Ikea Group is registered in the Netherlands. Thanks to Dutch tax treaties, Inter Ikea Group can receive the 3 percent royalties from Ikea Group on very good terms. According to the Greens' report, a large part of the money s then again diverted to other parts of the Ikea business empire tax free. The Greens want the European Commission to do a thorough investigation into Ikea's tax evasion. "The Commission already investigated tax evasion by companies like Google, Starbucks and Apple. There should be much more of that type of investigation. We want Ikea to also be investigated.", Bas Eckhout, European parliamentarian for the Greens, said to the newspaper.