There have been reports that have recently begun breaking in Europe regarding the tax evasion scandals and crimes that have been perpetrated by the Swedish furniture giant. Many sources and reports seem to be stating that IKEA has been evading taxes according to the various national and international laws prescribed by the European governments and the European Union. IKEA has been evading taxes worth 1.1 billion dollars, including 39 million dollars in Germany, 26 million dollars in France and 13 million dollars in the United Kingdom.
Reports state that IKEA had been suspecting of wiring money and routing it through various subsidiary companies across Europe. One particular money route was discovered wherein the money trail seemed to be sent through a subsidiary in the Netherlands and was then pushed through Luxembourg and Lichtenstein where it remained as large untaxed amounts of money. Green Party in the European Union parliament was one of the major investigative parties that made an announcement and breakthrough discovery that the Swedish furniture giant was up to the nefarious activities. While there is yet to be a conclusive answer or conclusive evidence, many parts of the company have been kept under investigation.
The European Union investigative authorities are still investigating the issue for more clarity and in order to gauge the veracity of the claim. IKEA remained tight-lipped over the matter and has issued just one public and press statement. The company has decided to go with the restrictive media approach. In the statement issued by IKEA, they had mentioned that IKEA, as a company always has, and always will follow tax regulations that are enshrined and in-sync with national and international law. IKEA was very specific in ensuring that they did not offend the sentiments of the European Union.
Even though the company made the public statement they were not in the mood to take many counter questions. The company also turned down interviews and invitations to comment by many of the large media houses. Tax evasion has lately become a very intense and compounded problem considering the variety of tax brackets offered across various nations within the EU. Countries such as Germany, France and the UK have high asking rates for corporate taxes, however, Ireland and Luxembourg have very low corporate taxes, which are encouraging companies to route most of their business through subsidiaries as a practice to cut on their high tax rates.