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International Tax Newsletter - Europe & African region

Europe & African region

International Tax Newsletter

International Tax - Europe and Africa, May 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 May and 31 May 2019.

Austria Greece OECD UK
Belgium Hungary Poland  
Czech Republic Italy South Africa  
European Union Netherlands Sweden  
Germany Nigeria Switzerland  

 

For a full summary of global tax developments, visit TaxNewsFlash- Global.

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

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International Tax Newsletter - Europe & African region

Austria

Proposed legislation  Tax reform  17 May 2019  

The Austrian Ministry of Finance published a draft bill regarding a tax reform for 2019-20. Among the measures being proposed are the following:

  • implementation of anti-hybrid provisions pursuant to the EU directive (ATAD 2) into Austrian domestic tax law
  • phased-in reduction of the corporate income tax rate from 25-23 percent as from 2022 and 21 percent as from 2023
  • provisions allowing small businesses to calculate their income tax on a lump-sum basis
  • reduction of progressive income tax rates
  • extension of research and development (R&D) premiums. 

  • Read more

Belgium

Administrative and case law VAT May 2019 

The Belgian VAT authorities have recognized that pharma contributions paid by pharma companies to a public health insurer may be eligible for a reduction of VAT owed on certain sales of medicines.

Czech Republic

Proposed legislation  Digital economy taxation  May 2019 

The Czech Ministry of Finance has introduced its plans for a new digital services tax. The Czech digital services tax is proposed to be imposed at a rate of 7 percent on certain revenues.

Proposed legislation  Tax package 2020  20 May 2019 

The Ministry of Finance disclosed draft amendments to tax laws for 2020, generally with a goal of increasing revenues.

Proposed legislation  VAT 17 May 2019 

A draft amendment to the VAT law for 2020 would introduce changes with respect to consignment stock arrangements and intra-community transactions with goods.

European Union

Administrative and case law VAT/Exchange of information  15 May 2019 

The European Commission announced a new system for EU Member States to exchange and process VAT data rapidly.

Administrative and case law Various tax areas  May 2019 

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

Proposed legislation  Digital economy/EU Blacklist  May 2019 

ECOFIN discussed digital tax and updates the EU blacklist.

Germany

Administrative and case law Online advertising May 2019

Taxpayers that are not residents of Germany may not be fully taxed on their German-sourced income. However, there recently have been situations when the tax authorities imposed tax liability on payments made to non-resident internet portal operators for online advertising.

Administrative and case law VAT 15 May 2019

The German Federal Tax Court has been uncertain as to what details are required for an input VAT refund application and specifically what “number of the invoice” is to be designated.

Greece

Tax legislation approved and regulatory update ATAD   7 May 2019 

Among the tax law changes included in tax legislation in Greece are anti-avoidance rules that generally align Greek tax law with the EU anti-tax avoidance directive (ATAD).

Hungary

Administrative and case law  VAT  May 2019

The Court of Justice of the European Union issued judgments in two VAT cases concerning application of the reverse-charge mechanism in Hungary. The cases are: Farkas, no. C-564/15, and PORR Építési Kft, no. C-691/17.

  • Read more

Italy

Tax legislation approved and regulatory update Brexit  May 2019 

Italy has enacted a regime for UK entities currently conducting business operations in Italy and for Italian entities conducting business in the UK, in the event the UK leaves the EU without a deal.

Tax legislation approved and regulatory update Tax incentives for individuals   30 April 2019

Law Decree no. 34 includes measures expanding an existing tax incentive program for certain individuals.

Tax legislation approved and regulatory update Tax incentives 1 May 2019 

A decree of “urgent economic growth measures” was published in the official gazette. The decree introduces the following tax incentives:

  • the reintroduction of an extra or bonus depreciation regime for certain tangible assets
  • a reduced rate of corporate income tax on reinvested profits
  • an increase in the deductibility of local real estate tax for corporate income tax purposes
  • simplification of the patent box regime
  • reintroduced business combinations bonus.

  • Read more
Tax legislation approved and regulatory update VAT 1 January 2021

VAT measures are included in a decree concerning “urgent economic growth measures”. The decree delays the effective date of the VAT imposed with regard to remote sales of certain imported goods.

Netherlands

Administrative and case law State aid/WHT  2 May 2019


The Court of Justice of the European Union rendered its decision in a case concerning state aid as it relates to a Dutch dividend withholding tax refund claim. The case is: A-Fonds case (C-598/17).

Nigeria

Administrative and case law  Audits/Stamp duty  May 2019 

The Revenue Mobilization Allocation and Fiscal Commission indicated it intends to commence forensic investigatory audits of “deposit money banks” with respect to their stamp duty collection activities for the periods from year 2000-18.

Administrative and case law Tax audits  May 2019 

The Federal Inland Revenue Service announced plans to conduct joint tax audit exercises with the tax authorities of the various Nigerian states.

KPMG publications  Nigeria Tax Journal  May 2019 

This edition of the Nigerian Tax Journal summarizes the decided tax cases and administrative pronouncements by RTAs and Tax Administrators in 2018.

OECD

Administrative and case law Taxation of digital economy 31 May 2019 

The OECD reported that there is an agreement for a “road map” with regard to resolving the tax challenges arising from the digitalization of the economy and a commitment for continued work toward a consensus-based long-term solution by the end of 2020.

Poland

Administrative and case law  State aid  16 May 2019

The General Court of the European Union issued a judgment finding that the European Commission incorrectly classified the Polish tax on the retail sector as illegal state aid. The case is: Poland v. Commission, T-836/16 and T-624/17.

South Africa

Tax legislation approved and regulatory update Carbon tax  1 June 2019

The final step in the legislative process for implementing the carbon tax has been completed and the carbon tax legislation has an effective date of 1 June 2019.

Tax legislation approved and regulatory update Individual taxation  1 March 2020

An amendment to the foreign earnings exemption that is to limit the exemption for the first ZAR 1 million of income for employment services rendered outside South Africa has an effective date of 1 March 2020.

Sweden

Proposed legislation   Chemical tax May 2019

A tax on chemicals used with respect to certain electronic products was introduced in Sweden in 2017. The Swedish government now appears ready to expand the scope of the chemical tax.

Switzerland

Tax legislation approved and regulatory update Capital gains April 2019

Customers of Swiss financial institutions who own UK property need to be aware that they may be subject to UK capital gains tax on any gains upon disposal arising after April 2019, even if they are not UK residents.

Proposed legislation Tax relief for employee participation  May 2019

A proposal to reduce the tax burden on employee participation in start-ups and family businesses has advanced following approval by committees of the Council of States and the National Council.

Proposed legislation Tax reform  19 May 2019

Swiss voters approved Swiss tax reform in a referendum. With the voters’ approval, the Swiss tax reform measures are expected to be effective 1 January 2020.

Administrative and case law  VAT May 2019

The Swiss federal tax authority published a first draft of updated guidance in relation to foreign companies and VAT.

United Kingdom

Tax legislation approved and regulatory update VAT May 2019

The VAT notice for Making Tax Digital has been updated and includes some new information and rules.

Proposed legislation Digital services tax May 2019

HM Treasury proposes to place a 2 percent tax on revenues derived from British users’ creation of value for digital services businesses.

Proposed legislation Taxation of offshore receipts May 2019

Proposed amendments to the recently enacted rules on the taxation of offshore receipts in respect of intangible property have now been released in draft format along with draft guidance, for consultation.

Administrative and case law CFC/Sate aid  25 April 2019

European Commission concluded on whether UK CFC finance company exemption constitutes state aid.

Administrative and case law Investment income  17 May 2019

FTT finds that a German pension scheme which had not registered in the UK was entitled to exemption from tax on its property investment income. The case is: BAV-TMW-Globaler-Immobilien Spezialfonds v HMRC.

Administrative and case law Stamp duty land tax 10 May 2019

First-tier Tribunal decision holds stamp duty land tax anti-avoidance legislation can apply whether or not there is ‘avoidance’. The case is: Hannover Leasing v HMRC.

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