Ikea accused of dodging $1.1 billion in taxes

ikea store

Ikea has been accused of dodging up to 1 billion euros ($1.1 billion) in taxes between 2009 and 2014, according to a report by the Green party in the European Parliament.

The political group is accusing the retailer of "large scale tax avoidance."

Its report, published over the weekend, said Ikea was deliberately shifting money from its stores around Europe through a subsidiary in the Netherlands. From there, they would end up untaxed in Lichtenstein or Luxembourg.

The European Commission, the top E.U. regulator, said it would study the report.

Ikea defended itself against the report. "We pay our taxes in full compliance with national and international tax rules and regulations," the company said in a statement.

The report estimated that for 2014 alone, the tax avoidance led to 35 million euros ($39 million) of missing tax revenues in Germany, 24 million euros ($26 million) in France, and 11.6 million euros ($13 million) in the U.K.

Countries like Sweden, Spain and Belgium are likely losing between 7.5 million euros and 10 million euros ($8.5 million to $11.2 million), the report claims.

Related: 'Days are numbered' for tax loopholes

"Profit shifting" is a common practice for multinational companies operating across Europe. They establish headquarters in low tax countries, such as Ireland or Luxembourg, and then funnel most of their European profits through there.

The European Union is trying to crack down on this kind of corporate tax avoidance, aiming to close legal loopholes that allow companies to minimize taxes.

Under new rules, countries will now be able to charge corporate taxes even if companies transfer their profits elsewhere.

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