Monday, 14 June, 2021

Brussels questions the tax advantages of Engie in Luxembourg


According to a preliminary investigation by the European Commission, the energy group has escaped 300 million euros in taxes via a tax agreement with Luxembourg. Engie, he assures that he has nothing to be ashamed of in this affair.

The Commission's investigation targets tax agreements signed by Luxembourg and GDF Suez around two financial transactions

Engie (ex GDF Suez) could have benefited from around 300 million euros in tax benefits in Luxembourg, according to documents published Thursday by the European Commission, which is investigating two “financial arrangements” of the French energy group within the Grand -Duchy. According to the preliminary survey published by Brussels, two Engie subsidiaries in Luxembourg were able to deduct a total of just over one billion euros from their taxable profit between 2009 and 2015.

However, if the Commission’s presumptions are confirmed, this sum should have been taxed at 29%, the corporate tax rate in force in Luxembourg, ie around 300 million euros. Asked by AFP, Engie, of which the French State owns a third of the capital, indicated that it “will provide (it) its comments to the European Commission and to the State of Luxembourg in the coming months”. Luxembourg for its part assured “that no special tax treatment” had been granted.

The Commission’s investigation, opened in mid-September, targets tax agreements (or “ruling”) signed by Luxembourg and GDF Suez around two intragroup financial transactions launched in 2009 and 2011. The French State is the main shareholder Engie, with 32.76% of the capital as of December 31, 2015. The French Ministry of Finance declined to comment.

The tax advantages granted to multinationals have been in the sights of Brussels for several months, in particular pressed by the revelations resulting from the LuxLeaks scandal in 2014, then from the Panama Papers in 2016. In 2014, the LuxLeaks affair highlighted the agreements made. by Luxembourg with multinationals to attract them to its soil, at a time when the current President of the Commission Jean-Claude Juncker was its Prime Minister.

“Nothing to be ashamed of”

“We have nothing to reproach ourselves with, that’s for sure”, assured for his part the general manager of Engie, Isabelle Kocher, by presenting his wishes to the press. “This is an investigation that the Commission has decided to open against the Grand Duchy of Luxembourg, not against Engie. Engie is not suspected of tax fraud, ”said Isabelle Kocher.

“Our practice as a group – it has always been our policy – is to systematically ask for a ruling” (tax agreement), she conceded. But recalling that Luxembourg was “one of the cradles” of Engie, she insisted on the fact that her group had “a fiscal policy which leads to not going to settle artificially somewhere simply for fiscal reasons”.

Luxembourg for its part assured “that no special tax treatment” had been granted to the French group.

(With AFP)

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