Spain Told to Claw Back Tax Breaks on Ships
MADRID—The
European Union Wednesday said it would ask Spain's government to recover some
tax breaks from buyers of Spanish ships between 2007 and 2011, a decision that
may weaken the already ailing shipbuilding industry in the EU country with the
largest number of people out of a job.
The
decision, announced by EU Competition Commissioner Joaquín Almunia, comes after
a two-year probe on the legality of the tax breaks Madrid gave buyers of
Spanish-built ships.
The
breaks allowed shipping firms to shave 20% to 30% off the purchase price
charged by the shipyard, a practice that Brussels says is incompatible with its
rules on state aid, which are designed to eliminate taxpayer support of
uneconomical industries or companies.
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