State Aid and Taxation of Transnational Companies: A Study of State-Corporate Crime

Abstract

This study examines the taxation of transnational companies from the perspective of state-corporate crime. As in Sutherland's pioneering study on white-collar crime, the author relies, in this case, on administrative decisions issued by the European Commissioner for Competition regarding Fiat and Starbucks. According to the Commissioner, the tax advisors of these organizations prepared and submitted special tax rulings on behalf of their clients that were granted by the Luxembourg and Dutch tax authorities, respectively. However, these tax rulings were considered illegal under European law, as they constitute state aid. Therefore, the Commissioner fined Fiat and Starbucks. In this inquiry, state aid from tax rulings is conceived as a process of capital accumulation that arises from states' regimes of permission based on the interactions between public sector and private sector actors. Thus, an observable symbiosis between tax authorities and transnational companies allowed the latter to use tax regulations in a manipulative way, while the former exercised weak/undue control. This study also unveiled the criminogenic role of tax advisors, an industry that is rarely held accountable for their actions.

Corporate Tax Avoidance and Neutralization Techniques: A Case Study on the Panama Papers

“…By relying on data on corporate tax avoiders, I seek to address the problem of validity of the sample by considering the CEOs of these corporations, who have been using "fictitious" companies, i.e., so-called paper companies registered in low-tax jurisdictions, to reduce tax liabilities in their countries of incorporation, although they (the CEOs) have not been convicted of this felony. Recent administrative decisions of the European Commission for the Competition illustrate the point of "nonconviction" (with the imposition of fines instead) of corporate tax avoiders (Evertsson 2017).…”

Moving Beyond Abstract Typologies? Overview of State and State-Corporate Crime

“…Other more current examples of state-corporate crime research emphasize the need for widening the focus on state-corporate crime to fully recognize the symbiotic significance (Whyte, 2014), describe the state-corporate cover-up of the 2010 Gulf of Mexico spill (Bradshaw, 2014) and the social harm of the Spanish crisis due to state-corporate crime (Bernal, Forero, & Rivera, 2014), and expose the National Security Administration’s surveillance and the cooperation of major telecommunications companies (Finley & Esposito, 2014). Others have written on the “Mirage of Pirates: State-Corporate Crime in West Africa’s Fisheries” (Standing, 2015), human rights violations of state corporations such as the practice of gas flaring in Nigeria (Izarali, 2016), the collusion and Bid rigging networks and state-corporate crime in the construction industry (Reeves-Latour & Morselli, 2017), the loss of coastal land due to state-corporate crime (Bisschop, Strobl, & Viollaz, 2018), the states’ aiding and taxation of transnational companies (Evertsson, 2017), market criminology–state-corporate crime in the petroleum extraction industry (Ezeonu, 2018) to the texting of Kramer and Michalowski’s integrated theoretical model of state-corporate crime (Patton, 2019).…”

Seismic Risks: a Criminological Analysis of European Investment Bank Support for the Castor Project

“…This body of research began in the early 1990s and has included case studies on the Space Shuttle Challenger disaster (Kramer 1992), the criminogenic features of the United States' (US) nuclear weapons industry (Kauzlarich and Kramer 1998), and the 2007 collapse of the I-35 W bridge over the Mississippi River (Schotter and Rhineberger-Dunn 2013). State-corporate crime research has expanded beyond the US to include case studies on the UK government's relationship with private military companies (Whyte 2003), the mining and extractive industries in Colombia (Zaitch and Gomez 2015), and tax rulings made by EU member states that facilitate aggressive tax planning (Evertsson 2017).…”