Apple, Google, Ikea and McDonald's are all facing a probe by European regulators on whether they are getting an unfair special tax dealing advantage from the EU countries where they operate.
Both Apple's and Google's European operations are run from Ireland which EU regulators want to probe on whether they have collaborated with the nation on getting favorable tax deals in the region.
The tax hearing follows a similar case in November when Google, HSBC, Anheuser-Busch InBev and eight more companies were probed on the same topic.
While it is true that the European tax committee, which organized the hearing, has no power to order these companies on making the necessary changes, the tax hearing serves as an official reminder on how multinationals are causing political concerns on the way they avoid their local tax responsibilities.
Other companies that are being probed by European regulators on their tax affairs include Starbucks and Fiat Chrysler Automobiles (FCA).
Both Starbucks and Fiat Chrysler reportedly declined to attend the tax hearing which is scheduled by the committee. Both are also in the middle of pending tax-related court cases in Europe.
Starbucks challenged the European Commission's order on recovering back taxes of up to 30 million euros from Dutch authorities.
Fiat Chrysler turned down the committee's invitation to attend the hearing following the company's appeal against a finding by EU on how it received a favorable tax deal with Luxembourg.
Recently, Facebook made an announcement that it intends to begin paying more tax in the United Kingdom. This means that instead of routing its UK earnings to a different country in order to pay lower taxes, the company decided to pay corporation tax on most of its earnings in the region.
Soren Hansen, head of Inter Ikea Group, plans to challenge the accusation made last month by the Parliament's Green Party on how the Swedish furniture retailing company avoided paying taxes worth around 1 billion euros between 2009 and 2014. The company had reportedly channeled its royalty income using a Dutch company as well as through Liechtenstein and Luxembourg.
Majority of these companies seemed true to their claim that their operations in Europe are compliant with the region's existing tax laws. They also have the responsibility of providing the best return to their shareholders which is inclusive of paying taxes.
The European countries in question are being sought to change their local tax laws in order to prevent companies from getting lower rates on their tax responsibilities by simply moving their earnings into a different country.
