McDonald’s Faces the Results of an EU Tax Probe

They May Find it Hard to Swallow

An EU probe into McDonald’s is now at its final stages and we bet the fast food giant can taste the pressure. The results would indicate whether or not McDonald’s unfairly benefited from a large tax break in Luxembourg.

According to reports – or rumors if you like – the European Commission could dish up a decision in this case before the EU goes on a summer break in August. That’s even faster than a decision on Amazon’s Luxembourg tax deals.

Last August, EU Competition Commissioner Margrethe Vestager ordered Apple to pay up to 13 billion euros (around $13.9 billion) – with plenty of added interest – in back taxes because of an illegal agreement with Ireland. Both Apple and Ireland have appealed in court and a legal verdict is still pending. Amazon and McDonald’s were warned that they were next in the plan to bring an end to EU tax havens, and punish those who enjoyed them.

In December McDonald’s announced it will move non-U.S. tax base from Luxembourg to the UK. The company has also had to deal with criticism from consumer groups and trade unions, claiming it avoided over 1 billion euros in EU taxes between 2009 and 2013.

The investigations have added to the existing tensions between the United States and Europe, and some US policy makers have implied that the EU is targeting US companies. European policy makers have stated that additional investigations are planned.

What will the decision be and how will it affect McDonald’s shares? At iFOREX you can invest in McDonald’s share CFDs, as well as in the share CFDs of many other leading brands and potentially benefit from their success – or even from their failure. Learn more.


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