Belgian "Excess Profit" Tax Regime Declared Illegal | KPMG | CA

Belgian "Excess Profit" Tax Regime Declared Illegal

Belgian "Excess Profit" Tax Regime Declared Illegal

Global Tax Adviser, January 19, 2016. The European Commission has concluded that selective tax advantages granted by Belgium under its "excess profit" tax regime are illegal under EU state aid rules. According to the Commission's announcement, which was released January 11, 2016, the regime has benefitted at least 35 multinationals, who must now return an estimated €700 million in unpaid taxes to Belgium. The Belgian "excess profit" tax regime has been applied since 2005 and has allowed certain multinational group companies to pay substantially less tax in Belgium on the basis of tax rulings.

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The "excess profit" tax regime only benefitted certain multinational groups that were granted a tax ruling while "stand-alone companies" (i.e., companies that are not part of groups) only active in Belgium could not claim similar benefits. The EU found the regime was "a very serious distortion of competition" within the EU's single market, affecting a broad range of economic sectors. 

For more information, contact your KPMG adviser. 

Disclaimer

Information is current to January 19, 2016. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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