Share a Tax Base? The Spanish Coca-Cola Dispute between Basque and State Tax Authorities and Its Lessons for BEFIT

This article examines Spain’s “Coca-Cola” dispute as a case study in the failure of intra-state coordination. Before 2013, several regional bottlers purchased the concentrate independently. Following the 2013 Iberian reorganization, the Basque bottler Compañía Norteña de Bebidas Gaseosas, S.A. (NORBEGA) became the purchasing and logistics hub in Bizkaia. This shift led to divergent interpretations by the Provincial Council of Bizkaia and the State Tax Administration regarding who acquired what and where, resulting in VAT being paid to one authority but not refunded by the other and withholding tax discrepancies linked to an alleged implicit royalty embedded in the concentrate price. The Basque Arbitration Board, the body entrusted with resolving such conflicts, remained inactive for years, undermining tax neutrality and legal certainty. Ultimately, the Spanish Supreme Court validated the Bizkaia-centred purchasing model. The same tensions now reappear under the EU Business in Europe: Framework for Income Taxation (BEFIT) proposal, showing that shared tax bases demand timely dispute resolution, binding ex ante rulings and taxpayer-indemnity safeguards.