EU

“EU to investigate UK tax loophole for multinationals”

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Source: theguardian.com 25 October 2017

“The EU is to launch an investigation into a British government scheme that may help multinational firms pay less tax, the Guardian has learned.

Margrethe Vestager, the EU competition commissioner, will announce on Thursday that she is opening an in-depth investigation into a UK tax scheme that exempts multinationals from anti-tax avoidance measures. Officials think the special exemption for multinationals may break EU competition rules by allowing them to pay less tax than domestic-only rivals. Read the rest of this entry »

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Amazon and Apple caught in latest EU tax crackdown

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Source: bbc.co.uk 4 October 2017

The European Union has launched a fresh crackdown over taxes paid by tech giants Amazon and Apple.

Amazon has been ordered to repay €250m (£221m; $293m) in back taxes after the European Commission said it had been given an unfair tax deal in Luxembourg.

The Commission also plans to take Ireland to court over its failure to collect €13bn of back taxes from Apple.

Source article here

 

“EU Citizenship for Sale: Legal Scheme Allows Corrupt Politicians and Businessmen to Slip into the EU”

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Source: occur.org 18 September 2017

“Russian and Ukrainian oligarchs suspected of corruption are among hundreds who have acquired EU passports under the “golden visa” program – a bourgeois shortcut to European citizenship in exchange for cash investments, the Guardian reported Sunday.”

“The paper claims that Cyprus alone has made over $US 4 billion selling passports to international oligarchs, “granting them the right to live and work throughout Europe,” completely legally.

However, Cyprus is not alone. “The Golden Visa program for Spain, Portugal, Malta, Greece and Cyprus are the most prominent. Bulgaria and Hungary offer residency and citizenship by investment in Europe through government bonds,” the Golden Visa website claims.”

Source article here

 

MEPs vote to close loopholes for exploiting EU and third country tax differences

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Source: europarl.europa.eu, 27 March 2017

Economic and Monetary Affairs Committee MEPs have voted to close loopholes which allow some of the world’s largest corporations to avoid paying tax on profits by exploiting differences in the tax systems of EU and third countries.

These mismatches allow corporations established in two jurisdictions (inside and outside the EU) to use the lack of coordination between national tax systems either to have the same expenditure deducted in both jurisdictions (so the firm enjoys a double tax deduction), or to have a payment recognised as tax deductible in one jurisdiction but not recognised as taxable income in the other.

The report now goes to the Council for its consideration.

Source press release here

 

Trade defence instruments at a glance

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Source article by Jones Day 10.03.2017 via The International Law Office

The field of trade defence instruments (TDIs) is among the most active in international trade law and their use could further increase as a result of the current wave of protectionism.

TDIs are measures imposed by countries in order to protect their markets when harmed by certain trade practices by exporters (dumping) or other governments (subsidisation), or by an unforeseen, sharp and sudden increase in imports. Read the rest of this entry »

Jean-Claude Juncker blocked EU curbs on tax avoidance

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Source: theguardian.com 1 January 2017

The president of the European commission, Jean-Claude Juncker, spent years in his previous role as Luxembourg’s prime minister secretly blocking EU efforts to tackle tax avoidance by multinational corporations, leaked documents reveal.

Proposals opposed by Junker’s Luxembourg included; plans for tax authorities in each member state to subject their dealings with multinational businesses to peer review; an investigation into cross-border tax avoidance strategies, known as “hybrid mismatches”, often used by multinationals to conjure up artificial tax savings; improved information sharing between member states on tax deals granted to multinationals in private.

Source article here

 

Google Lowered 2015 Taxes by $3.6 Billion Using ‘Dutch Sandwich

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Source: Bloomberg 21 December 2016

Alphabet Inc.’s Google saved $3.6 billion in worldwide taxes in 2015 by moving 14.9 billion euros ($15.5 billion) to a Bermuda shell company, new regulatory filings in the Netherlands reveal.

The amount the company shifted through its Dutch subsidiary, Google Netherlands Holdings BV, and then on to a Bermuda mailbox was 40 percent greater than in 2014, according to filings the company made with the Dutch Chamber of Commerce on Dec. 12. News of the filings was first reported by the Dutch newspaper Het Financieele Dagblad.

Alphabet moves the bulk of its non-U.S. profits through this Dutch subsidiary, which has no employees. The company has used the Netherlands company since 2004 as part of a tax structure dubbed a “Double Irish” and a “Dutch sandwich.” By moving most of its international profits to Bermuda, the company was able to reduce its effective tax rate outside the U.S. to 6.4 percent in 2015, according to Alphabet’s filings with the U.S. Securities and Exchange Commission.

The Irish government closed the tax loophole that permitted “Double Irish” tax arrangements in 2015. Companies already using the structure, however, are allowed to continue employing it until the end of 2020.

Source article here

Apple and EU Clash in Public Ahead of Court Fight Over Tax Bill

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Source: Bloomberg, December 2, 2016

The EU’s August decision is “seriously flawed” and implies Apple products such as its best-selling smartphones are designed in the Irish city of Cork, rather than the U.S., a lawyer for the California-based tech giant argued during a state-aid conference in Copenhagen Friday. An EU official hit back, saying the company was creating a “very nice tax story.”

Ireland last month filed its appeal against the EU decision after Finance Minister Michael Noonan repeatedly said that the country “fundamentally disagrees” with the commission’s analysis and was left with no choice than to go to court.

Source article here

 

Brexit: legal implications and potential impact on M&A activity

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Source: Davis Polk & Wardwell LLP, July 27 2016

On June 23 2016, the UK electorate voted to leave the European Union, a process commonly called ‘Brexit’.

The referendum was advisory rather than mandatory so it will have no immediate legal consequences. It will, however, have a profound long-term effect.

As the next steps will be driven by UK and EU politics, it is difficult to predict the future of the United Kingdom’s relationship with the European Union and their impact on M&A activity.

Source article here

 

 

Closer cooperation between EU Tax Authorities in the drive for greater transparency

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Tax authorities in the EU have agreed to cooperate more closely to enable Member States to ensure that all their taxpayers pay their fair share of the tax burden.

So the global drive for transparency and accountability is gathering pace, bringing more commitments for affected entities that need to comply with reporting programmes such as the EU’s Directive on Administrative Cooperation (DAC).

Read the rest of this entry »