Microsoft among those in EU tax investigation

Microsoft Corp, the world's biggest software maker, is among the companies involved in an EU inquiry into Luxembourg's tax treatment of multinational firms, Bloomberg reported citing people familiar with the EU's review.

According to one of the people, requesting anonymity, the EC had quizzed Luxembourg about how it taxed Microsoft's intellectual property. Two other people said, competition regulators also asked questions about McDonald's Corp taxes in Luxembourg.

In their drive against tax avoidance, EU competition regulators last month opened a probe into suspected tax breaks for Apple Inc in Ireland, Starbucks Corp in the Netherlands and Fiat Finance & Trade SA in Luxembourg, the bloc's richest country in per capita terms.

''We are in constant contact with the European Commission on all these tax issues and Luxembourg is pretty confident in the way it handles its taxation issues and so we're going to monitor the information with the commission and hand over the information that is requested,'' Pierre Gramegna, Luxembourg finance minister, said on CNBC on Friday.

Meanwhile, an EU investigation into the use of offshore tax havens by corporates, was extended to Amazon yesterday, Mailonline reported.

The online retailer is one among the many multinationals whose tax bills had come under the spotlight since the EC widened its inquiry into how firms used countries such as Luxembourg slash their tax bill, an official said yesterday.

Some of the other companies under investigation include construction equipment maker Caterpillar and UK mobile telecoms group Vodafone, while Apple, Starbucks and Fiat Finance and Trade are already on the list.

According to The Financial Times Amazon's main European operating company, Amazon EU Sarl was under investigation over whether its decisions on corporate tax complied with state aid rules.

An EU official told the newspaper that Amazon's tax arrangement in Luxembourg was being looked into.

The ecommerce site drew sharp criticism last month after it was revealed that it funnelled about £11 billion through its Luxembourg-based subsidiary in 2013, but paid only £4 million in UK corporation tax last year - 0.1 per cent of the £4.3 billion in sales that the company generated in the UK last year.