Two weeks ago, the European Union Commission released a report to the European Union Council and European Parliament on the implementation of the Council Directive 2016/1164, which lays the ground rules against tax avoidance practices that may have a negative effect on the market. The report by the EU Commission also covers amendments made by Council Directive (EU) 2017/9522 in regards to hybrid mismatches in developing countries. These anti-tax avoidance directives are known as “ATAD.”

It is hoped that the report will help set things right when it comes to impact evaluation of the ATAD and also offer a comprehensive view on the implementation of the ATAD measures across the EU member states.

The report states that Ireland, Austria, Spain, Denmark, and Ireland, are still playing catchup when it comes to compelling with their obligations to adopt specific measures and rules. These measures include transposition measures in line with interest limitations, controlled foreign corporation rules, and general anti-abuse rules (GAAR).

As a way to curtail any lapses, the EU Commission opened ex officio infringement procedures. In addition, the Commission opened infringement cases against Spain, Germany, Latvia, Greece, Romania, Portugal, and other member states, for failing to implement national measures for mismatches and exit taxation.

The report mentions that a detailed evaluation of the ATAD measures will come up in another report in two years.

Mind you, the Commission insists that the completion of such a detailed report will depend on the level at which they need to revise the ATAD given the fact that there are other issues relating to corporate tax avoidance practices that must be taken care of first.

Tax problems Fajardo And Associates can help

Tax Resolution Services Fajardo And Associates can help