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 October and 31 October 2012.
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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 |
Belgium introduces a new reverse-charge regime effective 1 January 2013. Because the new reverse-charge regime will no longer require a deposit, taxpayers can file a claim for refund of an already made deposit. At the same time, the taxpayer must send a refund application to its VAT auditor.
Read more |
| Wage Tax |
1 January 2012 |
The Belgian tax authorities released a new list of frequently asked questions concerning how to calculate the benefit-in-kind of a company car.
Read more |
| Administrative and case law |
Corporate income tax |
Punch Graphix Prepress Belgium NV v. Belgische Staat, C.371/11 (18 October 2012) |
The Court of Justice of the European Union issued a judgment in a case concerning Belgian law implementing the Parent-Subsidiary Directive, and concluded that the concept of a liquidation within the context of the Directive must be interpreted as meaning that a merger-by-acquisition cannot be considered to be a liquidation.
Read more |
| Withholding tax |
Commission v. Belgium, C-387/11 (25 October 2012) |
The Court of Justice of the European Union issued a judgment finding the Belgian taxation of dividend and interest income from the capital of non-resident investment companies, having no permanent establishment in Belgium, constitutes an unjustified restriction on the freedom of establishment and the free movement of capital under the EU treaty.
Read more |
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| Cyprus |
| Tax legislation adopted and regulatory update |
VAT |
October 2012 |
Cyprus introduced new VAT rules for insurance and finance companies.
Read more |
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| Czech Republic |
| Proposed legislation |
Budget |
2013 |
The Czech Republic Government has re-submitted its 2013 austerity package to the Chamber of Deputies in October 2012. The proposed legislation concerns individual income tax, withholding tax on passive income (e.g., located in tax haven jurisdictions), excise tax on mineral oils, and real estate transfer tax.
Read more |
| VAT |
1 January 2013 |
Technical changes to the VAT law concerning insurance and reinsurance brokers will be effective 1 January 2013.
Read more |
| Treaties |
DTT |
October 2012 |
Based on the new Protocol to the double taxation treaty with Switzerland, withholding tax on dividends paid by subsidiaries to their parent companies will be reduced to 0% when holding a 10% share continuously over a period of one year.
Read more
Based on the new treaty, payment of dividends between companies where the shareholding is at least 10% and payments to pension funds will be tax exempt. In other cases, a 15% tax rate will apply.
Read more |
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| Denmark |
| EU |
Withholding tax |
October 2012 |
The EU Commission challenges Danish legislation on outbound dividends to foreign investment funds. Non-Danish “undertakings for collective investments in transferable securities” (UCITS) may therefore want to consider filing protective refund claims with the Danish tax authorities (SKAT).
Read more |
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| Estonia |
| Tax legislation adopted and regulatory update |
Taxation act |
1 December 2012 |
The Estonian Parliament passed amendments making changes to the procedural provisions of the tax law. The amendments are effective 1 December 2012. The amendments are mostly related to applying a new function-based operating model to the core processes of the Tax and Customs Board.
Read more |
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| European Commission |
| EU |
VAT |
October 2012 |
The European Commission issued a consultation requesting comments concerning certain reduced VAT rates and what changes would be appropriate under EU VAT rules.
Read more |
| Financial Transaction Tax |
October 2012 |
On 9 October 2012, the Economic and Financial Affairs (ECOFIN) Council of the EU discussed the current status of the EU Financial Transaction Tax (FTT). The discussion focused on the issue of enhanced cooperation, and more specifically on which Member States are willing to move forward under this procedure. Eleven Member States have expressed their support for the initiative, which means that, in principle, there is sufficient support for those Member States to adopt an FTT between themselves under this procedure.
Read more
Refer to the following Euro Tax Flash for the EU Commission’s draft decision for the introduction of a FTT by 10 member states. |
| CCCTB |
October 2012 |
KPMG’s EU Tax Centre has prepared a guide to the CCCTB proposals in an effort to provide clear, practical descriptions of the proposals as well as insights into the detailed technical aspects.
Read more |
| Tax legislation adopted and regulatory update |
VAT |
1 January 2013 |
The new VAT invoicing requirements are effective in 2013.
Read more |
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| France |
| Proposed legislation |
Corporate Income Tax/Personal Income Tax |
2012 |
There are new proposed corporate and individual tax measures aim at reducing the deficit by raising tax revenue, with a focus on large corporate taxpayers and individuals who are considered to be wealthy. Certain provisions will be effective for FY 2012 (i.e. measures may have different effective dates). For more information, refer to the following short summary or more detailed
information note. |
| Tax legislation adopted and regulatory update |
Withholding tax |
17 August 2012 |
The recently enacted 2nd Amended Finance Act for 2012 provides for a new 3% tax on dividend distributions. The validity of the new dividend distribution tax may be challenged both under EU law and under income tax treaty provisions.
Read more |
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| Germany |
| Proposed legislation |
Business tax |
2013 |
The German Government introduced a draft act to modify and simplify business taxation. Completion of the legislative process on these proposals is expected by the end of 2012.
Read more (item 1) |
| Corporate income tax |
2013 |
The German Government issued a draft proposal that would allow the formation of a German tax group with a non-German subsidiary provided that it has its legal “seat” in the EU/EEA and its effective place of management in Germany.
Read more |
| Administrative and case law |
Corporate income tax/Trade tax |
6 June 2012 |
The Federal Tax Court ruled that the qualification of so-called interest on equity which is possible under Brazilian law, is under certain conditions, de facto 95% exempt from corporate income tax and trade tax.
Read more (item 2) |
| Corporate income tax |
6 June 2012 |
The Federal Tax Court ruled that provisions for tax field audit costs must be created by large businesses even before a tax audit order has been issued.
Read more (item 4) |
| DTT |
13 June 2012 |
For income derived from sports activities performed in Germany including income from other sources related to this performance such as compensation for TV broadcasting rights, tax is levied by means of withholding the tax. In general, the tax rate withheld amounts to 15.825% (incl. solidarity surcharge) of the compensation. However, a foreign recipient of such compensation may claim to be exempt from withholding tax or claim refund if Germany does not have the right to tax the compensation based on an applicable Double Tax Treaty (DTT).
Read more (item 5) |
| Tax legislation adopted and regulatory update |
Corporate income tax |
October 2012 |
The Frankfurt/Main tax office issued guidelines that an EBITDA carry-forward cannot arise in fiscal years in which the interest income generated by a business equals or exceeds interest expense (so-called net interest income).
Read more (item 3) |
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| Hungary |
| Tax legislation adopted and regulatory update |
Corporate income tax/VAT |
1 January 2013 |
The Hungarian Parliament passed tax legislation concerning ’small entrepreneurs’.
Read more |
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| Ireland |
| Other |
Tax facts |
October 2012 |
KPMG in Ireland issued a tax guide for investing in Ireland.
Read more |
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| Italy |
| Proposed legislation |
VAT |
1 July 2013 |
The Italian Government approved a project of law that includes proposed increases to the VAT rates. The proposed VAT rate increase would be effective 1 July 2013.
Read more |
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| Luxembourg |
| Proposed legislation |
Budget |
1 January 2013 |
The Luxembourg Budget 2013 was presented and includes several tax-related measures. Details of the tax measures will be included in a new draft law to be submitted to Parliament and, subject to enactment by Parliament, will be effective as of 1 January 2013.
Read more |
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| The Netherlands |
| Proposed legislation |
Payroll tax |
1 January 2013 |
The Cabinet presented six bills to the Lower House that included changes to the payroll tax, remittance reductions, and social security provisions under current law. The amendments are intended to be effective 1 January 2013.
Read more |
| Insurance premium tax |
1 January 2013 |
The Dutch insurance premium tax rate could increase from 9.7% to 21% beginning 1 January 2013 under a pending proposal.
Read more |
| Budget |
1 January 2013 |
Proposed changes to the Tax Plan 2013 are introduced and reflect provisions that had been included in the Partial Budget Agreement 2013 (known as the ’Fall Agreement’ as agreed to on 1 October 2012). The proposed amendments concern:
| • |
non-implementation of the ‘vitality savings plan’ |
| • |
an increase in the insurance premium tax rate |
| • |
the introduction of a ‘work bonus’ |
Read more |
| Personal income tax |
October 2012 |
A special committee established to examine the Dutch individual (personal) income tax and allowances as part of an investigation for a simplified tax system—published its interim report ‘Energizing the tax system’. The final report will be published at the beginning of 2013.
Read more |
| Corporate income tax |
1 January 2013 |
A new interest deduction limitation measure for excessive participation interest will be effective 1 January 2013.
Read more |
| Administrative and case law |
Withholding tax |
X NV v. Staatssecretris van Financiën, C-498/10 (18 October 2012) |
The Court of Justice of the European Union published its decision in a case concerning withholding tax on payments to non-resident service providers. The CJEU concluded that the disputed Dutch tax legislation restricts the freedom to provide services, but that the regime may be justified by the need to safeguard the effective collection of income taxes.
Read more |
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| Nigeria |
| Proposed legislation |
Petroleum
Profits Tax |
3 October 2012 |
The Petroleum Industry Bill 2012 has been forwarded to the National Assembly for consideration and passage into law. The Bill provides a legal, fiscal and regulatory framework for the Nigerian petroleum industry and will repeal the Petroleum Act, Petroleum Profits Tax Act, Deep Offshore and Inland Basin Production Sharing Contracts Act, as well as a number of other laws which currently govern the Nigerian oil and gas industry.
Read more |
| Budget |
2013 |
Nigeria’s president presented the 2013 federal government budget before a joint session of the National Assembly.
Read more |
| Tax legislation adopted and regulatory update |
Incentives |
27 April 2012 |
A new regulation provides tax incentives for companies doing business in Nigeria. The incentives are in the form of exemptions from tax—not tax credits—and are intended to encourage employment and infrastructure development in Nigeria. The regulation has an effective date of 27 April 2012 and will be effective for 5 years.
Read more |
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| Norway |
| Proposed legislation |
Budget |
2013 |
Norway’s state budget for 2013 has been presented by the government and includes several tax-related proposed measures.
Read more |
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| Poland |
| Proposed legislation |
VAT |
1 January 2013 |
Proposed changes to Poland’s VAT law include measures that are scheduled to be effective in two stages—the first, from 1 January 2013 and the second from 1 July 2013.
Read more |
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| Serbia |
| Tax legislation adopted and regulatory update |
VAT |
1 October 2012 |
The VAT rate in Serbia has been increased to 20% (was 18%) effective 1 October 2012.
Read more |
| Excise tax |
1 October 2012 |
Certain excise tax rates increased beginning 1 October 2012.
Read more |
| Municipal taxation |
1 October 2012 |
Legislation enacted in late September 2012 amends the rules with respect to municipal taxation of signboards, advertising boards, and ownership of motor vehicles. The changes are effective 1 October 2012.
Read more |
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| Slovakia |
| Proposed legislation |
Corporate income tax/ Personal income tax |
1 January 2013 |
The government’s bill to amend Slovakia’s income tax law includes measures that would:
| • |
increase the rate of corporate income tax to 23% |
| • |
increase the rate of individual (personal) income tax to 25% on a tax base amount in excess of 176.8 times the minimum subsistence level |
Read more |
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| South Africa |
| Tax legislation adopted and regulatory update |
Incentives |
1 October 2012 |
For a 10-year period, beginning 1 October 2012, the full R&D tax deduction can only be claimed from the date when a pre-approval application form is filed with the Department of Science and Technology.
Read more |
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| Spain |
| Treaties |
DTT |
1 January 2013 |
The new income tax treaty between Spain and Germany entered into force on 18 October 2012, and the treaty provisions are effective 1 January 2013.
Read more |
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| United Kingdom |
| Administrative and case law |
VAT |
Field Fisher Waterhouse v. HM Revenue & Customs, C- 392/11 (27 September 2012) |
The Court of Justice for the European Union issued a judgment concerning services provided by a landlord and whether such services are subject to VAT. The CJEU has effectively referred the essential questions back to the national court whilst providing guidance on how to interpret European Law.
Read more |
| Corporate income tax |
HMRC v FCE Bank PLC |
The UK Court of Appeal published its decision in a case concerning a claim to group relief by UK-resident subsidiaries when the parent company was resident in the United States. The court held that the question of the parent company's liability to UK tax was not material to the rules for surrendering losses between UK-resident companies.
Read more |
| EU |
Corporate income tax |
October 2012 |
The European Commission today announced the referral of the UK to the Court of Justice of the European Union for the UK tax treatment of (1) transfers of assets abroad, and (2) the attribution of gains to members of non- resident companies. According to an EC release, UK law provides different tax treatment of domestic and cross-border transactions.
Read more |
| Tax legislation adopted and regulatory update |
Corporate income tax |
October 2012 |
HM Revenue & Customs published a summary of responses to the consultative document ‘Possible changes to income tax rules on interest’ and indicated which proposed changes will be included in Finance Bill 2013 (FB 2013) and which will be dropped.
Read more |
| Corporate income tax |
October 2012 |
HM Revenue & Customs released a “high level” briefing paper on the taxation of profits of multinational businesses. The briefing paper was issued in response to media stories suggesting that some “high-profile” multinational businesses were not paying their fair share of corporation tax on profits made from business transactions with UK customers.
Read more |
HRMC released guidance on the new patent box rules.
Read more |
HM Revenue & Customs published further sections of the draft guidance on the new CFC legislation in Finance Act 2012.
Read more |
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