In the introductory speech of the 3rd European Competition Forum, the Competition Commissioner, Mr. Joaquin Almunia, spoke about the European Commission’s ambition to fully investigate the tax disparities existing between the various countries of the European Union.

He presented the idea that the European Commission could use state aid control instruments to promote a better allocation of resources by making tax systems less selective. According to the Commissioner, tax competition should be exercised according to the quality of the tax systems and not depending on the levels of taxation.

In recent months the European Commission has been sending requests for information to some Member States whose tax system is particularly generous with multinational companies. Companies in the digital sector, such as Google, Amazon or Yahoo, have obviously come under the Commission’s scrutiny. If they had received any illegal aid they would be asked to pay it back.

Nevertheless, the Commission first has to establish that the tax measure concerned is selective, which implies making a comparison in a same Member State between the treatment afforded to the undertakings benefiting from the aid and the general tax rules. Any advantage discovered in favour of those undertakings must not then be justified by the nature and economy of the system. A very sensitive task for the EU institutions to undertake.