EU Black List, a New Perspective on Tax Havens

Published in: IAFEI Quarterly 39th Issue, January 2018

The European Union recently took one more step in the worldwide fight against tax avoidance and evasion with the release of the common EU list of non-cooperative tax jurisdictions.
The EU black list – the first such list at EU level – includes seventeen off shore countries: American Samoa, Bahrain, Barbados, Grenada, Guam, South Korea, Macao SAR, Marshall Islands, Mongolia, Namibia, Palau, Panama, Saint Lucia, Samoa, Trinidad and Tobago, Tunisia and United Arab Emirates.

Download

Spirit of Tax Law and Tax (Non-)Compliance: Reflections on Form and Substance

Published in: IBFD European Taxation January 2018

In complying with their tax duties, multinationals need to align their conduct with both the letter and spirit of the law. The latter requires identifying legislative intent, which is challenging in a rapidly evolving business and tax environment that is increasingly globalized and digitalized. In addition, tax avoidance legislation is increasingly being employed against aspects of non-compliance with the spirit of the law. The need for clear legislative drafting arises, therefore, as a necessary guarantee to prevent abusive interpretations.

Download

Italy’s Tax Police Publishes Manual against Tax Evasion and Fraud

Published in: TP Week

On December 4 2017, the Italian Financial Guard (Tax Police), updated its practical guidelines regarding performance of tax audits with the release of the Operational Manual against evasion and tax fraud – Circular n. 1/2018 (circular).
The circular was updated on December 1 2017 and entered into effect on 1 January 1 2018.
Transfer pricing is one of the subjects detailed in the circular. Following specification of the applicable rules and recent OECD developments, the circular illustrates the practical procedures for transfer pricing audits.

Download

A European Taxpayers’ Code

Published in: Journal - Intertax 45-12

The European Commission published ‘Guidelines for a Model for A European Taxpayer’s Code’. The Guidelines seek to clarify taxpayers’ fundamental rights and obligations in the EU while proposing best practices for their enhancement. The European initiative follows several international ones to the same end. Their comparison reveals the Guidelines’ rather restricted scope. Although they constitute a step forward, they fall short of their potential, demanding further steps to ensure due protection of taxpayers’ rights.

Download

Italy Turns Up the Heat on EU with Digital Sales Tax

Published in: TPWeek

Italy is hoping its proposed digital sales tax will send a message to the EU and accelerate the process of finding consensus on digital economy taxation. However, the proposal interferes with the EU’s plans and could create double taxation scenarios.

Italy hopes to curb tax avoidance by digital companies with a proposal for a new digital sales tax that, if approved, would apply from January 1 2019. The proposal would impose a 6% tax on digital transactions made through electronic means to Italian tax residents with business income, and to Italian permanent establishments (PE) of non-tax residents. This will work out as the buyer paying the service provider 94% of the amount, while withholding 6% for the Italian Treasury.

Download

CbCR Obligations for Italian Entity Members of US Groups

Published in: TPWeek

An agreement for the automatic exchange of country-by-country reports (CbCR) between Italy and the US (Agreement) came into effect on September 27 2017, as announced by the Italian minister for economy and finance.
The above agreement derives its legal basis from Art. 26 of the Convention for the Avoidance of Double Taxation in effect between the US and Italy.

Download

And the Blame Goes to... EU Tax Intermediaries

Published in: IAFEI 37th issue

In June 2017, the European Commission released the fiercely debated proposal for a directive to introduce mandatory disclosure rules in the area of taxation (Proposal) in the European Union (EU).
The proposed legislation is highly relevant to EU tax professionals but also to enterprises with activities in the EU, implementing tax planning structures that could potentially be regarded aggressive. Specifically, such enterprises may under certain circumstances have own obligation to report information to national tax authorities. In any case, they must be aware that potential tax planning structures they might use shall become reportable and subject to automatic exchange of information among Member States, once the Directive is implemented.

Download

Taxless Corporate Income: Balance against White Income, Grey Rules and Black Holes

Published in: European Taxation - IBFD

The potential of globalization and digitization is clearly manifested in international taxation, currently undergoing a complete overhaul. A key factor driving the transformation is “stateless income”. Although this term is extensively used, its meaning is ambiguous.
It might be said to comprise flexible income earned by multinationals or simple taxpayers through virtual or cyber transactions. Primary liability for its creation seems to lie with state legislators, who should hence act to remedy the situation.

Download

Capturing Dematerialized Money through Anti-Money Laundering Provisions

Published in: Kluwer International Tax Blog

The Committee on Economic and Monetary Affairs and the Committee on Civil Liberties, Justice and Home Affairs of the European Parliament recently finalized the amendments to the existing Anti-Money Laundering Directive (AMLD). This decision was based on the related proposal of the European Commission, submitted in July 2016.EU initiatives in this direction – including adoption of AMLD in 2015 and two Regulations in 2015 and 2016 to enhance transparency of fund transfers and identify third countries with significant deficiencies in anti-money-laundering legislation – are surely not a novelty.  Most importantly, the EU is not alone in this struggle; its actions are in line with corresponding activities of the Financial Action Task Force and the OECD.

Download

 

Transfer Pricing Audits: Suitability of Transfer Pricing Documentation

Published in: Intertax- Issue 45.6&7

Article 26 of Legislative Decree No. 78/2010 introduced in Italy a rewarding regime related to the non-application of penalties involving intercompany transfer pricing adjustments in connection with taxpayer’s submission to the Tax Authorities of ‘suitable’ documentation to support taxpayer’s transfer pricing policies. Assessment on the ‘suitability’ of such documentation by Tax Inspectors has given rise to a variety of critical issues in the last few years.

Download

Cooperative Compliance: The Italian Framework

Published in: TPWeek

On May 26 2017 the Italian regime on cooperative compliance was further clarified by the Italian Revenue Agency (IRA or tax administration) by virtue of a new regulation (provvedimento). Antonella Della Rovere and Federico Vincenti of Valente Associati GEB Partners explain.

The Italian framework of cooperative compliance has been built since 2014, when it was envisaged by law as part of a set of measures to establish a fairer, more transparent and growth-oriented national tax system.

Download

Valente Associati GEB Partners – Studio Legale dell’Anno Fiscalità Internazionale (Law Firm of the Year: International Tax)

For the constant and considerable increase of our international client base, significant R&D investments and high-level academic involvement and contributions.
An innovative spirit and capacity to introduce ground-breaking concepts and approaches complement the range of already integrated services to ensure all-round excellence.

Download

Fiscal State Aid: What Conclusions May Be Drawn From The EU’s Reservations

Tax evasion has remained in the top of the “heatedly-debated-issues” charts for several years and is not expected to “drop down” soon. Instead, the intensity in the fight against it seems to be increasing on every occasion (Lux Leaks, Panama Papers etc.). In this “war”, European Commission’s (EU) decisions on fiscal state aid are beyond doubt the most controversial “weapon”.

In essence, such decisions invalidate tax rulings issued by Member States since they allow multinationals (MNEs) to pay less tax than standalone companies in comparable situations under Member States’ tax laws in violation of state aid rules.

Download

Italy: Changes to the TP Framework

On April 24 2017, a new law decree (N. 50/2017) introduced changes to the Italian transfer pricing framework. Antonella Della Rovere and Federico Vincenti from Valente Associati GEB Partners look at the changes.

In a nutshell, the Italian provision on transfer pricing (art. 110 para. 7 of the Italian Income Tax Code) was amended to clearly and definitively encompass the principle of open market conditions.

Download

G7 Priorities in Taxation

Published in: INTERTAX - Volume 45, Issue 8 & 9

The international tax framework is being overhauled to keep pace with a business environment transformed by the globalization’s and digitalization’s forces. This transition period is a challenge and an opportunity. Fiscal policy is a priority worldwide and key concern in this year’s G7 Summit. The 10 Key Priorities in this area were presented in a special Forum held under the auspices of the Italian G7 Presidency to give voice to Academia and Research. Inherent ultimate purpose of sound fiscal policy is the achievement of sustainable economic growth and widespread prosperity in a system worthy of people’s trust.

Download