Following a meeting of the High Level Working Party on Taxation on 7 July 2016, and building on the base erosion and profit shifting (BEPS) roadmaps of previous Presidencies, the new Slovak Presidency of the EU has issued its Presidency Roadmap, setting out its future planned work for the coming months on BEPS, as well as other matters relating to taxation.
The main action points set out in the document are summarised below:
Interest & Royalties Directive (IRD)
Noting previous disagreement on including a minimum effective tax clause in the IRD, the Presidency stated that it intends to explore a different path in order to reach political agreement towards the end of its term, taking into account the political agreement reached on the Anti-Tax Avoidance Directive (ATAD).
Beneficial ownership of non-transparent entities
The Presidency intends to immediately start technical work on the proposal to amend the Directive on Administrative Cooperation (DAC 5) to allow tax authorities to access information under the Anti-Money Laundering Directive. It will also aim to adopt Council conclusions on the EC’s Communication on further measures on transparency, tax evasion and avoidance.
EU list of third country non-cooperative jurisdictions
The Presidency plans to make progress on identifying these jurisdictions, assessing their compliance, and exploring possible defensive measures against them.
Good governance in Tax matters with third countries
The Council called for an update of the existing EU standard provision on good governance in tax matters and asked the Code of Conduct Group to examine key elements which should be contained in a clause to be inserted in EU agreements with third countries.
The Presidency intends to work on a legislative proposal on hybrid mismatches involving third countries as soon as it is presented by the EC. This proposal is expected by October 2016.
The Presidency will support the Code of Conduct Group in monitoring the legislative process necessary to change existing patent box regimes.
Implementation of the Council Conclusions on the future of the Code of Conduct
The Presidency will support the work of the Code of Conduct Group to develop guidance on issues such as anti-abuse, third countries, substance and transfer pricing.
Dispute Resolution Mechanism within the EU
The EC has announced its intention to submit this proposal by November 2016 and the Presidency plans to examine it soon after.
Renewed Common (Consolidated) Corporate Tax Base
The Presidency intends to start an examination of new proposals from the EC, expected by November 2016, on a Common Corporate Tax Base and an interim cross-border loss relief mechanism.
The work of the Code of Conduct Group will involve the identification of potential problems which arise when payments are made from the EU to a third country. However, no action point is mentioned in the roadmap.
Mandatory disclosure rules
The Presidency will look into the possibility of exchanging best practices and adopting guidance in the Code of Conduct Group on mandatory disclosure rules targeting specific offshore tax evasion schemes.
Conditions and rules for the issuance of tax rulings
The Presidency expects the Code of Conduct Group to continue working on a set of guidelines on the conditions and rules for the issuance of tax rulings by Member States.
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