(March 18, 2015) 

On March 18, 2015 the European Commission released a Q&As regarding its plans to combat corporate tax avoidance and to improve Tax Transparency. The Q&As session is divided in 3 parts:

(I)           General Questions

(II)        Questions relating to Tax Rulings

(III)      Questions relating to Other Tax Transparency Measures

In the Q&As the following questions are discussed: 

General Questions:

·        Why is the Commission presenting a Tax Transparency Package?

·        What is the difference between tax evasion and corporate tax avoidance?

Questions relating to Tax Rulings:

·        What is a tax ruling?

·        Why is the Commission proposing new transparency requirements for tax rulings?

·        What information exchange rules are currently in place for tax rulings?

·        What new transparency provisions is the Commission proposing for tax rulings?

·        How would the automatic exchange of information on tax rulings work in practice?

·        What information on tax rulings would Member States be obliged to exchange automatically?

·        How would the automatic exchange of information on tax rulings be enforced?

o        How would automatic exchange of information on tax rulings help fight corporate tax avoidance? (2 examples given)

·        Do all Member States issue tax rulings and how many are issued every year?

·        Would all tax rulings be covered by the proposal?

·        Would the new requirements create administrative burdens for tax administrations or companies?

·        Would businesses' commercial secrets still be protected under the proposed new measures?

·        Why is the Commission not proposing to make all tax rulings public?

·        Would the automatic exchange of information prevent the types of tax ruling that are currently under state aid investigation?

·        How do the proposed EU measures for tax rulings relate to work being done by at international level through the OECD's BEPS project (Base Erosion and Profit Shifting)?

Questions relating to Other Tax Transparency Measures:

·        What work has been done to improve tax transparency and tackle corporate tax avoidance in recent years?

o        Expanding the automatic exchange of information on financial accounts

o        Negotiating stronger tax agreements with neighbouring countries

o        Tightening corporate tax legislation

o        Tackling harmful tax competition

o        Increasing corporate transparency

o        Boosting transparency in capital flows

o        Strengthening tools to fight VAT fraud

o        Establishing a Platform on Tax Good Governance

·        What other new initiatives to improve tax transparency are in today's Package?

·        Why is the Commission proposing to repeal the Savings Taxation Directive?

·        Would the repeal of the Savings Tax Directive have any consequences for the new tax agreements that the Commission is currently finalising with Switzerland, Andorra, Lichtenstein, Monaco and San Marino?

·        Is the Commission going to propose any new transparency requirements for companies?

·        What is the Code of Conduct on Business Taxation and why is the Commission suggesting that it be reviewed?

For further information click here to be forwarded to the Q&As session as published on the website of European Commission.

Click here to be forwarded to our article: “European Commission presents Tax Transparency Package” in which a.o. a link to the proposal for a Council Directive amending Directive 2011/16/EU as regards mandatory automatic exchange of information in the field of taxation is included.

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