International Tax Europe and Africa December 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 December and 31 December 2019.

Austria Germany Nigeria   UK 
Belgium Hungary Poland  
Bulgaria Ireland Serbia  
Czech Republic Italy South Africa  
EU Luxembourg Sweden  
France Netherlands Turkey   

 

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

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International Tax Newsletter - Europe & African region

Austria

  Tax area concerned Relevant date Description of measures and publication link
Austria 
Administrative and case-law Assignment of receivables December 2019 

The Austrian Federal Finance Court held that an assignment of receivables by a taxpayer to a company located in Malta, with which the taxpayer frequently engaged in trade and transactions, was an abusive arrangement.

Belgium


Tax area concerned Relevant date Description of measures and publication link
Belgium
Proposed legislation  Earnings stripping rules December 2019 

A new regime that limits certain interest deductions—known as the earnings stripping rules—has an effective date of 1 January 2019. A draft law has been introduced in parliament to clarify the earnings stripping rules.

Bulgaria

  Tax area concerned Relevant date Description of measures and publication link
Bulgaria  
Tax legislation approved and regulatory update Corporate income tax    1 January 2020 

Changes to the income tax law were made by legislation that was published in the official gazette. The amendments are generally effective 1 January 2020.

Czech Republic

  Tax area concerned Relevant date Description of measures and publication link
Czech Republic
Proposed legislation  Digital services tax December 2019

The government submitted to the Chamber of Deputies a bill introducing a digital services tax to be imposed at a rate of 7%.

EU


Tax area concerned Relevant date Description of measures and publication link
EU
Tax legislation approved and regulatory update CJEU   December 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  Financial transaction tax 9 December 2019

The German Finance Minister issued a revised proposal for a Council Directive regarding the introduction of a common financial transaction tax to the participating EU Member States in the so-called enhanced cooperation procedure.

France

  Tax area concerned Relevant date Description of measures and publication link
France
Administrative and case-law WHT December 2019

The French Supreme Tax Court issued a decision that may provide refund opportunities regarding withholding tax when there were expenses incurred for direct professional services.

Germany

  Tax area concerned Relevant date Description of measures and publication link
Germany
Administrative and case-law Controlled foreign company rules  December 2019

The Federal Tax Court (BFH) held that for the years at issue (2005-2007), the controlled foreign company rules for passive income requiring an add-back of passive income with an investment character did not violate the free movement of capital under the EU treaty.

Hungary

  Tax area concerned Relevant date Description of measures and publication link
Hungary 
Tax legislation approved and regulatory update Tax audits  December 2019 

The National Tax and Customs Authority announced a pilot program concerning a standard audit file for tax purposes. The program would be intended to support the provision of data to facilitate more efficient tax audits and the automated processing of data.

Ireland


Tax area concerned Relevant date Description of measures and publication link
Ireland  
Tax legislation approved and regulatory update  TShort-term business visitors  1 January 2019 

Guidance from Irish Revenue requires employers to consider only the number of work days employees spend in Ireland in a single year of assessment—a change from requirements issued in 2018 that made tracking Irish workdays across consecutive tax years and even multiple years necessary.

Italy

  Tax area concerned Relevant date Description of measures and publication link
Italy 
Proposed legislation   DST   December 2019

Changes have been made to the proposed digital services tax during the legislative process.

Administrative and case-law  Financial transaction tax November 2019

The Advocate General of the Court of Justice of the European Union rendered an opinion in a challenge to Italy’s financial transaction tax. The Advocate General concluded that the tax does not infringe the free movement of capital.

Luxembourg


Tax area concerned Relevant date Description of measures and publication link
Luxembourg  
Tax legislation approved and regulatory update  ATAD / Advance tax agreements  19 December 2019

The Luxembourg Parliament on 19 December 2019 passed the 2020 budget bill. The legislation includes expiration of pre-2015 advance tax agreements as well as measures to transpose into Luxembourg domestic tax law the EU Anti-Tax Avoidance Directive.

Netherlands

  Tax area concerned Relevant date Description of measures and publication link
Netherlands 
Tax legislation approved and regulatory update 2020 Tax Plan / ATAD / DAC 6   17 December 2019

The Dutch Upper House of Parliament adopted tax measures that include the “2020 Tax Plan” in addition to bills to implement the second EU anti-tax-avoidance directive and the EU directive on cross-border arrangements.

Administrative and case-law  Transfer tax  29 November 2019

The Dutch Supreme Court issued a judgment concerning application of the reduced 2% transfer tax rate regarding the acquisition of a right to an apartment in a building converted from an office building to residences.

Nigeria

  Tax area concerned Relevant date Description of measures and publication link
Nigeria 
Tax legislation approved and regulatory update 2020 Appropriation Act 17 December 2019

The president of Nigeria signed the 2020 appropriation bill into law.

Tax legislation approved and regulatory update Royalty regime  December 2019

The new royalty regime, enacted as part of legislation concerning deep offshore and inland basis production-sharing contracts, specifies a baseline royalty of 10% for crude oil and condensates that are produced in the deep offshore and 7.5% for the “frontier and inland basin.”

Administrative and case-law Tax enforcement program 17 December 2019

The Federal Inland Revenue Service issued a notice announcing the start of a nationwide tax enforcement exercise.

Administrative and case-law Interest on tax liabilities  December 2019

The Tax Appeal Tribunal issued a judgment holding that interest on an additional state tax assessment is to be computed by imposing interest only on the principal amount of the tax liability.

Treaties  Claiming tax treaty benefits December 2019

A circular issued by Nigeria’s Federal Inland Revenue Service provides guidance on claiming benefits under an income tax treaty.

Poland

  Tax area concerned Relevant date Description of measures and publication link
Poland
Tax legislation approved and regulatory update WHT  December 2019

Draft decrees again delay the effective date of application of withholding tax rules in Poland.

Serbia


Tax area concerned Relevant date Description of measures and publication link
Serbia  
Tax legislation approved and regulatory update Corporate income tax  December 2019

Serbia’s parliament passed legislation that amends the corporate income tax law, and the legislation was published in the official gazette on 6 December 2019.

South Africa


Tax area concerned Relevant date Description of measures and publication link
South Africa  
Proposed legislation  Venture capital companies  December 2019

Legislation would make changes that could affect investors in venture capital (VC) companies.

Sweden


Tax area concerned Relevant date Description of measures and publication link
Sweden
Proposed legislation  DAC 6  December 2019  

The upcoming rules on reporting obligations under the mandatory disclosure rules are proposed to be effective 1 July 2020, with some measures being effective retroactively from 25 June 2018.

Administrative and case-law Employment income  December 2019 

The Swedish high court issued a new decision that affirms the conclusion that director's fees are to be taxed as income from employment.

Turkey

  Tax area concerned Relevant date Description of measures and publication link
Turkey  
Tax legislation approved and regulatory update DST  7 December 2019

The digital services tax provisions were published in the official gazette.

United Kingdom

  Tax area concerned elevant date Description of measures and publication link
United Kingdom
Tax legislation approved and regulatory update Hybrids  December 2019

KPMG in the UK considers HMRC’s updated guidance on the UK hybrid and other mismatches rules.

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