This e-newsletter gives you an overview of international corporate tax developments being reported globally by KPMG member firms in the Europe and Africa regions between 1 February and 28 February 2013.
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Tax area concerned |
Relevant date/case reference |
Description of measures and publication link
(Considerations in italic where necessary) |
| Belgium |
| Tax legislation adopted and regulatory update |
VAT |
1 January 2013 |
A number of VAT rules have changed effective 1 January 2013, including:
| • |
A limitation on VAT deductions with respect to company cars (to reflect business use of the vehicle) |
| • |
New VAT rules for electronic invoicing and ‘self-billing’ |
Read more |
| EU |
Individual income tax |
February 2013 |
Because a tax reduction is not available to non-residents who earn their income in the Walloon region, the European Commission announced it would refer Belgium to the Court of Justice of the European Union.
Read more |
| Administrative and case law |
Insurance tax |
RVS Levensverzekeringen v. Belgische Staat, C-243/11 (21 February 2013) |
The Court of Justice of the European Union held that article 50 of Directive 2002/83/EC concerning life assurance is to be interpreted as meaning that an EU Member State may apply the insurance tax on life insurance premiums paid by the individual policyholder, who is a resident in that EU Member State—regardless of the country in which the contract was concluded.
Read more |
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| Cyprus |
| Administrative and case law |
VAT |
C-557/11 (25 October 2012) |
KPMG in Cyprus stipulates, following a judgment of the Court of Justice of the European Union, that ‘In-house supplies’ by tour operators are services that to not fall within designated travel services, and thus may be subject to specific VAT rules in Cyprus.
Read more |
| Tax legislation adopted and regulatory update |
VAT |
1 January 2013 |
The VAT Office published a new Circular which makes reference to the new VAT treatment for the long-term hiring of means of transport with effect as from 1 January 2013.
Read more |
| Treaties |
DTT |
February 2013 |
Representatives of the governments of Cyprus and Spain signed a new income tax treaty and Protocol. The treaty will enter into force following the completion of each country’s ratification procedures.
Read more |
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| Czech Republic |
| Proposed legislation |
VAT/Corporate income tax/Individual income tax |
2014 |
Pending legislative and regulatory changes in the Czech Republic include:
| • |
Planned changes to tax laws effective from 2014 |
| • |
First experience of the amended VAT Act 2013 |
| • |
Corporate law from 2014 |
| • |
Bill on Investment Companies and Investment Funds |
Read more |
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| Estonia |
| Administrative and case law |
Management’s liability/VAT |
February 2013 |
Case law has been published with respect to the following subjects:
| • |
A member of a company’s management board was liable for the company’s unpaid tax liability |
| • |
A member of the company’s management was liable for unpaid taxes |
| • |
The authority of local governments imposed VAT on transactions between local governments |
Read more |
| Other |
VAT/Corporate income tax/Individual income tax |
1 January 2013 |
KPMG in Estonia published a reference guide that sets forth tax rates for corporate and individual taxpayers, social security, VAT, and includes lists of available deductions, transfer pricing rules, and other information.
Read more |
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| European Commission |
| Proposed legislation |
FTT |
1 January 2014 |
The European Commission announced a proposed Directive for implementing the financial transaction tax (FTT) under the EU’s enhanced cooperation procedure.
Read more |
| February 2013 |
The European Commission provided an overview of the status of the financial transaction tax.
Read more |
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| Finland |
| Administrative and case law |
Corporate income tax |
A Oy, C-123/11 (21 February 2013) |
The Court of Justice of the European Union held that under the EU ‘freedom of establishment’ provision, a national law cannot prevent a company that is a resident in one EU Member State from deducting losses suffered by a subsidiary in another EU Member State, following a merger, if the subsidiary had exhausted all possibilities within its country to use its accumulated tax losses.
Read more |
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| France |
| Tax legislation adopted and regulatory update |
Administration |
2013 |
A program to revise the tax audit and inspection procedures of the French tax authorities is being launched as a pilot in 2013. The program will test the processes for developing an enhanced taxpayer-tax administration relationship. Initially, 10 large business taxpayers will be selected to participate in the new audit pilot program during 2013.
Read more |
| EU |
VAT |
February 2013 |
The European Commission announced that it is referring France to the Court of Justice of the European Union for the reduced rate of VAT applied by France to ebooks.
Read more |
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| Germany |
| Tax legislation adopted and regulatory update |
Corporate income tax |
February 2013 |
New legislation significantly expands the scope of the German DCL rules. The new DCL rules will apply equally to all members of an Organschaft—whether or not the entities are dual tax residents. Prior DCL rules only denied the use of losses of a dual-resident Organschaft parent company in instances when the losses were considered in another jurisdiction. The new rules will apply to all open tax years and thus may affect prior years as well.
Read more |
| Proposed legislation |
Corporate income tax/Real estate transfer tax/DTT |
February 2013 |
A ‘conciliation committee’ that was convened to resolve different positions taken by the Bundesrat (upper house) and Bundestag (lower house) with respect to measures in the 2013 Tax Act, adopted a proposal to:
| • |
Extend taxation of hybrid financings in the context of dividend taxation |
| • |
Prevent real estate transfer tax-blocker structures |
| • |
Change the treatment of partnerships with regard to the interpretation of tax treaties |
Read more |
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| Hungary |
| Tax legislation adopted and regulatory update |
Individual income tax |
February 2013 |
Individual taxpayers in Hungary can request, via their income tax returns, that the tax authority transfer a percentage of their individual income tax payments to officially recognized charitable organizations.
Read more |
| Incentives |
February 2013 |
The Hungarian Government published a list of 47 areas that qualify as ‘free entrepreneurial zones’. Companies investing in these zones may realize special tax benefits (i.e. reduced corporate income tax, social tax, and vocational training contributions).
Read more |
| EU |
Excise tax |
February 2013 |
The European Commission announced it will refer Hungary to the Court of Justice of the European Union for the exemption from excise tax granted by Hungary to the production of certain fruit distillates (known as pálinka).
Read more |
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| Ireland |
| Proposed legislation |
Budget |
February 2013 |
Ireland’s Finance Bill 2013 was published on 13 February 2013.
The Finance Bill now will go through and complete the various stages of the legislative process, before enactment as Finance Act 2013 in early April 2013.
Read more |
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| Latvia |
| Other |
VAT/Corporate income tax/Individual income tax |
1 January 2013 |
KPMG in Latvia published a reference guide that sets forth tax rates for corporate and individual taxpayers, social security, VAT, lists of available deductions, and information concerning property tax, company car tax, and the tax treaty network.
Read more |
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| Lithuania |
| Other |
VAT/Corporate income tax/Individual income tax |
1 January 2013 |
KPMG in Lithuania published a reference guide that sets forth tax rates for corporate and individual taxpayers, social security, and VAT as well as a list of available deductions, transfer pricing provisions, and other information.
Read more |
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| Luxembourg |
| EU |
VAT |
February 2013 |
The European Commission announced that it is referring Luxembourg to the Court of Justice of the European Union for the reduced rate of VAT applied by Luxembourg to ebooks.
Read more |
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| The Netherlands |
| Tax legislation adopted and regulatory update |
VAT |
February 2013 |
VAT developments in the Netherlands affecting the retail sector include:
| • |
A Court of Appeal Amsterdam decision that VAT is owed on the payment that a seller of telephone cards receives for the sale of a telephone card, and not on the face value of the card |
| • |
A Court of Appeal request for a preliminary ruling from the Court of Justice of the European Union as to whether the supply of discount vouchers is exempt from VAT |
| • |
A request of an English court of the CJEU as to whether VAT is due on the sale of products paid for with a ‘fraudulent’ credit card |
| • |
Proposed amendments to the VAT Directive by the European Commission to address the VAT treatment of vouchers |
Read more |
| Housing market |
February 2013 |
The Dutch Cabinet and opposition parties reached an agreement on reforming the housing market.
Read more |
| Administrative and case law |
Wage tax |
February 2013 |
The 16 percent ‘crisis levy’ — to be reported by employers in their payroll tax return for March 2013 and remitted in April 2013 — may be contrary to EU law, given a February 2013 decision of the Court of Appeals Arnhem-Leeuwarden.
Read more |
| Proposed legislation |
Wage tax |
1 January 2014 |
Mandatory implementation by all employers of the ‘work-related costs’ rules — i.e. rules that would affect employee reimbursements — scheduled to be effective 1 January 2014 may be postponed for one or two years.
Read more |
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| OECD |
| Tax legislation adopted and regulatory update |
TRACE package |
February 2013 |
The Committee on Fiscal Affairs of the OECD announced the Treaty Relief and Compliance Enhancement (TRACE) package — a standardized system of treaty and domestic relief, including a complete implementation package for countries to move forward.
Read more |
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| Poland |
| Tax legislation adopted and regulatory update |
Excise tax |
1 November 2013 |
In Poland, a new excise tax on natural gas (and similar gases used for heating and propulsion) will be effective 1 November 2013.
Read more |
| Proposed legislation |
Corporate income tax |
2014 |
Legislation to expand the scope of Poland’s corporate income tax law is intended to be effective in 2014. Among the proposals included in the legislation are provisions:
| • |
Treating joint-stock partnership (SKA) and limited partnership (sp.k.) entities as taxable entities |
| • |
Recognizing taxable income when loan obligations, declared dividends, share redemptions, and similar obligations are satisfied by means of an in-kind contribution |
| • |
Expanding application of the transfer pricing documentation and thin capitalization rules |
| • |
Revising the treatment of a loss on disposal of receivables and allowing a deferral from an in-kind contribution of intangibles (patent, software copyright, know-how, license) to an entity by universities, scientific institutions, etc. |
Read more |
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| Serbia |
| Tax legislation adopted and regulatory update |
Individual income tax |
15 March 2013 |
The due date for filing individual income tax returns in Serbia, for the 2012 tax year, is 15 March 2013.
Read more |
| VAT |
1 February 2013 |
Serbia’s VAT law was amended in late September 2012. Subsequently, a number of regulations were issued to implement and regulate the VAT law changes. The changes are effective as of 1 February 2013.
Read more |
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| Slovenia |
| Tax legislation adopted and regulatory update |
Corporate income tax/Withholding tax |
2013 |
In Slovenia, new changes to the corporate income tax law for 2013 concern the availability of loss carry forwards; a ‘standard’ expense deduction for certain eligible corporate taxpayers; and withholding tax only with respect to payments made for certain services in ‘tax favorable’ countries.
Read more |
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| South Africa |
| Proposed legislation |
Budget |
27 February 2013 |
South Africa’s annual budget speech will be presented on 27 February 2013. Some speculate that possible revenue options could include:
| • |
An increased VAT rate |
| • |
An increased rate of individual income tax on taxpayers at the top end of the earnings schedule |
| • |
An increased corporate income tax rate |
Read more |
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| Spain |
| Administrative and case law |
Pensions |
Gonzalez v. INSS, TGSS, C-282/11 (21 February 2013) |
The Court of Justice of the European Union issued a judgment concluding that EU law precludes the Spanish method for calculating retirement pensions because Spain’s method does not take sufficient account of the fact that the individual worked in an EU Member State other than Spain.
Read more |
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| Turkey |
| Tax legislation adopted and regulatory update |
Incentives |
February 2013 |
Turkey’s Council of Ministers announced an expansion of an investment incentive regime, to provide tax incentives for qualifying investments in the automotive and energy-generation sectors.
Read more |
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| Ukraine |
| Tax legislation adopted and regulatory update |
Corporate income tax/Excise tax |
2013 |
New tax law in Ukraine for 2013 includes a reduced rate of corporate income tax, new tax incentives, and rules for excise tax on transactions involving securities and derivatives.
Read more |
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| United Kingdom |
| Tax legislation adopted and regulatory update |
Corporate income tax |
February 2013 |
Recent tax developments in the UK include:
| • |
A ‘Memorandum of Understanding’ between the United Kingdom and the Isle of Man providing for a voluntary disclosure regime — HMRC make the voluntary disclosure available to UK taxpayers from 6 April 2013 to 30 September 2016. |
| • |
HMRC reminded employers to start reporting PAYE in real time from the first pay-day on or after 6 April 2013. |
| • |
HMRC published interim guidance on certain aspects of the taxation of life insurance companies (effective 1 January 2013). |
Read more |
| Proposed legislation |
Oil & Gas |
February 2013 |
The UK Government issued draft legislation concerning the treatment of decommissioning expenditure in the oil and gas industry.
Read more |
| Budget |
28 March 2013 |
The UK Government announced that Finance Bill 2013 will be published on 28 March 2013.
Read more |
| Administrative and case law |
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Loss Relief GLO v. HM Revenue and Customs, [2013] EWHC 205 (Ch), 11 February 2013 |
The High Court — in a case concerning cross-border group relief claims in which the relevant losses arise in a group company other than one that is a directly held foreign subsidiary of the UK claimant — concluded that:
| • |
Concerning questions of EU law arising in relation to various corporate group structures, it is not appropriate for the High Court to refer the various group structure issues to the Court of Justice of the European Union at this stage |
| • |
Concerning the ‘no possibilities test’ per the CJEU judgment in Marks & Spencer (C-446/03), it would be reasonable for HM Revenue & Customs to insist on answers to its enquiries concerning the ‘no possibilities test’ that are confined to representative test cases. |
Read more |
| EU |
VAT |
February 2013 |
The European Commission announced that it will refer the United Kingdom to the Court of Justice of the European Union for the UK’s reduced rate of VAT on the supply and installation of energy-saving materials.
Read more |
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