Yahoo shifts Europe tax base to Ireland from Switzerland

Fri Feb 7, 2014 10:14am EST
 
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By Tom Bergin and Valentina Consiglio

LONDON/ROME (Reuters) - Yahoo! Inc is shifting its main European tax base to Ireland from Switzerland, a Reuters examination of company statements and accounts shows, as pressure mounts on the Alpine nation to abolish some corporate tax incentives.

The internet search group said the shift reflected a streamlining of its European operations and was not motivated by a desire to cut its tax bill, one of the higher in the U.S. tech sector.

"Yahoo pays all taxes required and complies with tax laws in all countries where we operate. We take our tax obligations seriously," Yahoo spokeswoman Caroline Macleod-Smith said.

However, tax experts said it was likely the changes that Switzerland is expected to make to its tax rules, following European Union pressure, had some influence over the decision, and that other companies could follow Yahoo's lead.

"Obviously tax reasons are part of the reasons they are going out of Switzerland," said Frank Marty, head of tax policy at lobby group Economie Suisse.

"The tax regimes we have are very successful (in attracting companies) but there is pressure that Switzerland abolishes the current regimes ... The risks are substantial," he added.

Currently, Switzerland offers tax rates to companies which make their profits outside Switzerland that are less than half the rates imposed on companies that operate locally.

EU rules require countries not to discriminate between domestic and foreign firms in taxation and Brussels has told Switzerland that if it wants to enjoy unfettered access to the bloc's market, it needs to scrap this practice.   Continued...

 
The Yahoo logo is shown at the company's headquarters in Sunnyvale, California April 16, 2013.REUTERS/Robert Galbraith