KluwerLawOnline.com - Intertax

Literature Review: Caroline Heber, Enhanced Cooperation and European Tax Law, Oxford University Press, 2021 by Roland Ismer

Fri, 22 Nov 2024 00:01:09 GMT

Volume 52 Online ISSN 0165-2826

The De Minimis Exclusions in the ATAD’s CFC Rules: A Normative Analysis

Fri, 22 Nov 2024 00:01:09 GMT

This study undertakes a normative analysis of the four de minimis exclusions in the controlled foreign company (CFC) rules of Article 7 of the European Union’s (EU’s) Anti-Tax Avoidance Directive (ATAD). In the EU, CFC legislation inherently restricts either the freedom of establishment or the free movement of capital. Case law from the Court of Justice of the European Union (CJEU) confirms that, for this restriction to be permissible, the scope of application of CFC legislation must be limited to only capture income from wholly artificial arrangements. First, this study evaluates the design of the four different de minimis exclusions in Article 7 against their stated objective to limit the administrative burden and compliance costs in order to ascertain their (relative) effectiveness. Second, the normative coherence of these provisions is evaluated in the context of the limited application – only to cases of abuse – of the CFC rules in the EU. The study finds that the de minimis exclusions pertaining to Model A (in Article 7(3)) are only effective to a limited extent in achieving their objective and could be redesigned to improve their effectiveness. Further, those pertaining to Model B (in Article 7(4)) are not normatively coherent in an EU context. Therefore, their inclusion cannot be justified, and it is recommended that they be deleted.

Volume 52 Online ISSN 0165-2826

Article: What Can the UN Do That the OECD Can’t or Won’t? [pre-publication]

Fri, 22 Nov 2024 00:01:09 GMT

The recent United Nations (UN) tax initiative was heavily criticized by certain developed states both during the discussions at the UN and following it. This criticism was based on the argument that the initiative would interfere with the alleged progress made by the OECD and its so-called inclusive framework. Other forms of the same argument were that the UN work would be a mere duplication of the OECD work and that the UNs do not have the expertise, experience, and resources of the OECD, which had served as the caretaker of the regime in the past sixty years or so. This article responds to this critique of the initiative with ten examples of desirable reforms needed by the international tax regime, reforms that the UNs is better equipped, and hopefully more willing than the OECD to implement.

Volume 53 Online ISSN 0165-2826