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State Aid and Tax Competition: Comments on the European Commission’s Decisions on Transfer Pricing Rulings

Saturnina Moreno González


As part of the fight against tax elusion and harmful tax competition, the European Commission has used the versatility of the Community legislation on State aid to supervise the tax ruling practices of the Member States in relation to the aggressive tax planning strategies implemented by multinational groups. In this context the aim of this work is to analyse the interpretation given to the criteria of “economic advantage” and “selectivity” by the Commission in the decisions on certain tax ruling practices as State aid, highlighting the peculiarities of this interpretation as regards the traditional explication of these criteria generally invoked by the Commission. This work also studies some of the problems arising from these decisions from the perspective of aid recovery. Finally, it reflects on the suitability and the limits of the general prohibition of State aid in tackling the problem of base erosion and profit shifting.
Keywords: Economic Advantage; Selectivity; Tax Ruling; Transfer Pricing; Aid Recovery; Harmul Tax Competition; Base Erosion; Profit Shifting.

Associate professor of Tax and Finance Law, with full professor accreditation, at University of Castilla-La Mancha. This work, closed on 15 September 2016, is part of the research Project “Taxation and new technologies in commerce and information. Proposals for adapting the tax system to the demands of the digital economy and society”, financed by the Ministry of Economy and Competitiveness, DER2014-55677-R. Contact: DOI: 10.21552/estal/2016/4/7


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