Nike under scrutiny over tax practices

European Commission is investigating whether royalties paid to Nike’s offshore units were higher than the market value of the intellectual property. Photo: AP

INTERNATIONAL – European authorities are investigating whether the Dutch government illegally allowed the American sportswear maker Nike to avoid paying taxes on profits from sales in the region, potentially exposing the company to huge penalties similar to those imposed on Apple and Amazon.

The inquiry, announced this week, is part of a broader European Commission crackdown on countries like Ireland, Luxembourg and the Netherlands over accusations that they gave questionable tax breaks to multinational companies, many of them based in the US, as a way of attracting corporate headquarters and white-collar jobs.

Similar investigations resulted in an order that Apple pay €14.3 billion, or $16.5bn, to the Irish government in 2016 and a requirement that Amazon pay €283 million to Luxembourg in 2017. Starbucks paid €25.7m

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