EC package on CCCTB, hybrid mismatches and dispute res | KPMG | UK
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EC package on CCCTB, hybrid mismatches and dispute resolution

EC package on CCCTB, hybrid mismatches and dispute res

The proposals include details on the Common Consolidated Corporate Tax Base initiative, as well as measures on hybrid mismatches and dispute resolution.


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The EC has published legislative proposals to relaunch its Common Consolidated Corporate Tax Base (CCCTB) initiative, as well as new measures to combat hybrid mismatches, including those involving non-EU countries, and to improve the existing procedures to resolve disputes involving double taxation within the EU. This follows previous proposals in 2011 for an optional CCCTB which did not progress due to insufficient support from Member States. The EC has now relaunched the CCCTB project, introducing a two-step approach where Member States first agree on rules for a Common Corporate Tax Base (CCTB), after which agreement should be reached on the consolidation element. If approved by all EU Member States, the CCTB proposals would apply from 2019 and the CCCTB proposals from 2021.

Unlike the 2011 proposal, the new rules (both CCTB and CCCTB) would be mandatory for all groups with global consolidated revenues of more than EUR 750m. The proposed rules would apply to business carried on through EU resident companies and permanent establishments, even if the group is headquartered outside of the EU. The system would be optional for other companies.

As a result of Brexit, the UK should not be directly impacted by the proposals. However as proposed, the regime would apply to the EU subsidiaries of large UK headquartered multinationals.  

As a tax measure, the introduction of the CCCTB regime will require the unanimous agreement of all EU Member States which is likely to be challenging, especially within the project timeframe.  In order to reach such an agreement we anticipate that significantly more detail will be needed on all aspects of the proposals including how the taxable profits will be calculated and then apportioned across the Member States.  All governments will want to understand the impact on their tax revenues as inevitably there will be losers and winners from any proposed changes.

For a look in more detail at these proposals, KPMG’s EU Tax Centre have prepared a Euro Tax Flash.


For further information please contact :

Mandy Pearson

Sarah Beeraje

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