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International Tax Newsletter - Europe & African region

Europe & African region

International Tax Newsletter

International Tax Europe and Africa January 2019

This e-newsletter gives you an overview of international tax developments being reported globally by KPMG member firms in the Europe and Africa Regions between 1 January 2019 and 31 January 2019.

Bulgaria France Netherlands Serbia
Croatia Greece Nigeria South Africa
Czech Republic Italy OECD Spain
European Union Malta Poland Sweden
Finland   Russia United Kingdom

 

For a full summary of global tax developments, visit home.kpmg/taxnewsflash.

To contact the International Tax Team email internationaltax@kpmg.com.

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International Tax Newsletter - Europe & African region

Bulgaria

Tax legislation approved and regulatory update VAT  1 January 2019 

Changes to the VAT law in Bulgaria are generally effective in January 2019.

Croatia

Tax legislation approved and regulatory update Corporate income tax  1 January 2019  

The interest rate on loans between related parties—the arm’s length interest rate—is reduced to 3.96 percent (down from 4.55 percent) per annum, effective 1 January 2019.

  • Read more

Czech Republic

Proposed legislation R&D January 2019

Changes to the research and development allowance rules have been proposed as part of a tax package that has already been passed by the Chamber of Deputies and is pending consideration by the Senate.

Administrative and case law VAT January 2019

The Supreme Administrative Court issued a judgment finding that the difference between the nominal value of a receivable and its purchase price upon its transfer may be viewed as consideration under a factoring contract and thus subject to VAT. The case is: 4 Afs 143/2018.

European Union

Proposed legislation  Tax policy 15 January 2019

The European Commission issued a communication on extending qualified majority voting to all EU tax policies.

Administrative and case law VAT  24 January 2019

The European Commission announced three referrals to the Court of Justice of the European Union concerning VAT and indirect tax issues.

Administrative and case law Various tax areas December 2018 / January 2019

The EU Tax Centre prepared a summary of EU tax developments that can have both a domestic and a cross-border impact.

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Administrative and case law State aid 9 January 2019

The European Commission reported it has opened an in-depth investigation to examine whether tax rulings granted by the Netherlands to a multinational corporation provide “an unfair advantage over its competitors” in breach of EU state aid rules.

Other  January 2019 January 2019

The European Commission issued a reminder that new rules to eliminate the most common corporate tax avoidance practices were effective 1 January 2019.

Finland

Administrative and case law Insurance premium tax    January 2019

The CJEU issued a ruling in a case concerning the location of risk for purposes of the insurance premium tax for insurance related to M&A transactions. The case is: C-74/18.

France

Administrative and case law VAT January 2019

The Court of Justice of the European Union (CJEU) issued a judgment in a case concerning the value added tax (VAT) recovery of costs incurred by a fixed establishment that are also applied with respect to the turnover of a foreign head office. The case is: C-165/17.

  • Read more

Greece

Tax legislation approved and regulatory update Corporate income tax rate January 2019

The corporate income tax rate for most corporations (except for credit institutions) will be reduced under a phased-in schedule: 28% for 2019; 27% for 2020; 26% for 2021; 25% for 2022 and later tax years.

Italy

Tax legislation approved and regulatory update ATAD 1 January 2019

A decree to implement the transposition of two EU Anti-Tax Avoidance Directives into Italian law was published in the official gazette.

Tax legislation approved and regulatory update Corporate income tax / R&D 1 January 2019

Changes to Italy’s corporate income tax and regional tax were enacted on 30 December 2018. These include:

  • extension of the “hyper” or bonus depreciation allowed certain tangible and intangible assets
  • amendments to the research and development tax credit
  • repeal of the notional interest deduction
  • lower corporate income tax rate for profits reinvested in the acquisition of income-producing assets and/or in job creation.

  • Read more
Tax legislation approved and regulatory update Tax amnesty 2019

A package of tax measures enacted in 2018 includes certain “tax amnesty” programs.

  • Read more
Proposed legislation Digital economy  January 2019

The Budget Law 2019 includes a “web tax”. Specifically, the new “web tax” will apply at a rate of 3% on revenue generated from certain digital services when provided under business-to-business or business-to-consumer transactions.

Administrative and case law E-invoicing January 2019

The Italian tax authorities have clarified certain issues relating to the mandatory “e-invoicing” rules that were effective beginning in 2019.

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Malta

Tax legislation approved and regulatory update ATAD January 2019

EU Anti-Tax Avoidance Directive was transposed into Maltese law. This includes measures in relation to interest limitation, exit taxation, GAAR and controlled foreign company rules.

Netherlands

Tax legislation approved and regulatory update Immigration January 2019

The Dutch government has decided that UK citizens and their family members who lawfully reside in the Netherlands before “Brexit” will retain their right of residence in the event of a Brexit “no deal.”

Nigeria

Tax legislation approved and regulatory update Tax incentives  25 January 2019

The president signed an executive order that provides certain tax incentives for road and infrastructure development.

  • Read more
Administrative and case law Corporate income tax  January 2019

The Federal High Court sitting in Abuja issued a judgment for the taxpayer in a case concerning the authority of the Federal Inland Revenue Service to assess a company’s liability for Nigeria’s companies income tax based on the value of the company’s properties.

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OECD

Publications Corporate Tax Statistics 14 January 2019

The OECD issued a report providing internationally comparable statistics and analysis from approximately 100 countries on four main categories of data:

  • corporate tax revenues
  • corporate income tax rates
  • corporate effective tax rates
  • tax incentives related to innovation.

  • Read more

Poland

Tax legislation approved and regulatory update Corporate income tax / Withholding tax January 2019

A decree limits application of Article 26(2e) of Poland’s corporate income tax law and temporarily postpones or limits withholding tax rules, depending on the type of payment.

Tax legislation approved and regulatory update VAT January 2019

In Poland, certain VAT amendments were effective beginning in 2019.

Russia

Tax legislation approved and regulatory update VAT / Tax compliance  January 2019 

There are new VAT requirements for foreign providers of electronic services for business customers in Russia. Foreign businesses must apply for VAT registration with the Russian tax authorities by 15 February 2019 (for services rendered as of 1 January 2019) or within 30 days (for services commenced in 2019).

  • Read more

Serbia

Tax legislation approved and regulatory update Corporate income tax January 2019 New legislation in Serbia generally is
effective for tax years beginning in 2019. Changes include:
  • new rules on tax depreciation and amortization
  • repeal of the limits on advertising and promotional expenses
  • a “double deduction” for qualifying research and development expenses. 

  • Read more

South Africa

     


Two court decisions in South Africa concern the application of section 24C of the Income Tax Act—the provision that allows taxpayers to claim a deduction for an expenditure to be incurred in future tax years for the performance of the taxpayer’s obligations under a contract.

Spain

Tax legislation approved and regulatory update Tax compliance 1 January 2019

Individuals and entities that provide tourism-related “intermediation services” to connect lessors and lessees (e.g., internet platforms) for holiday property rentals will be required to report the use of property for tourism purposes on a quarterly basis.

Sweden

Tax legislation approved and regulatory update Tax compliance  2019

Beginning in 2019, all employers required to file a monthly employer tax return must now report such tax information at both an individual level and a company level.

Administrative and case law Corporate income tax / Loss deductibility 10 January 2019

Advocate General Kokott of CJEU rendered Opinions in the Memira (C-607/17) and in the Holmen (C-608/17) cases. Both cases concerned the compatibility with EU law of the Swedish rules on the deductibility of losses from foreign subsidiaries, and the extent to which the ‘Marks & Spencer exception’ applies, i.e. losses are considered final.

United Kingdom

Tax legislation approved and regulatory update Entrepreneurs relief January 2019

Shareholders who do not meet the new profits and assets tests may now still qualify for Entrepreneurs’ Relief.

Proposed legislation Corporate income tax January 2019

Companies using brought forward tax losses need to fulfil new administrative requirements.

Proposed legislation Finance Bill January 2019

The Finance Bill completed its passage through the House of Commons with the conclusion of the report stage and third reading on 8 January 2019.

Administrative and case law Digital economy January 2019

Taxpayers qualifying for the six month deferral for Making Tax Digital should have received confirmation from HMRC.

Administrative and case law Functional currency January 2019

The Ball UK Holdings Ltd v The Commissioners for HM Revenue and Customs decision of the Upper Tribunal.

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