The Anti Tax Avoidance Package is part of the Commission's ambitious agenda for fairer, simpler and more effective corporate taxation in the EU. The Package contains concrete measures to prevent aggressive tax planning, boost tax transparency and create a level playing field for all businesses in the EU. It will help Member States take strong and coordinated action against tax avoidance and ensure that companies pay tax wherever they make their profits in the EU.
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The Chapeau Communication outlines the political, economic and international context of the Anti Tax Avoidance Package and gives an overview of the different elements.
Anti Tax Avoidance Directive
The Anti Tax Avoidance Directive proposes six legally-binding anti-abuse measures, which all Member States should apply against common forms of aggressive tax planning. It aims to create a minimum level of protection against corporate tax avoidance throughout the EU, while ensuring a fairer and more stable environment for businesses.
The proposed Directive sets out six key anti tax avoidance measures, which all Member States should apply:
- Interest limitation rule
- Exit taxation
- Switch-over clause
- General anti-abuse rule
- Controlled foreign company legislation
- Hybrid mismatches
Revision of the Administrative Cooperation Directive
The revised Directive proposes country-by-country reporting between Member States' tax authorities on key tax-related information on multinationals operating in the EU. These new transparency provisions will allow all Member States the information that they need to detect and prevent tax avoidance schemes.
The recommendation on Tax Treaties
The Recommendation advises Member States how to reinforce their tax treaties against abuse by aggressive tax planners, in an EU-law compliant way. It covers the introduction of general anti-abuse rules in tax treaties and the revision of the definition of permanent establishment.
Communication on an External Strategy for Effective Taxation
The External Strategy presents a stronger and more coherent EU approach to working with third countries on tax good governance matters. It also sets out a process to create a common EU list of third countries for tax purposes.
External Strategy for effective communication document 1
External Strategy for effective communication document 2
Study on Aggressive Tax Planning
The study looks at Member States' corporate tax rules (or lack thereof) that can facilitate aggressive tax planning and key structures used by companies to avoid taxation. It includes factsheets with the main findings for each Member State and examples of tactics used by multinationals to lower their taxes.
The anti-tax avoidance package and other EU and international developments: Scrutiny and democratic control by national parliaments
- Video - Anti Tax Avoidance
- Chapeau Communication
- Anti Tax Avoidance Directive
- Revision of the Administrative Cooperation Directive
- Recommendation on Tax Treaties
- Communication on an External Strategy for Effective Taxation
- Study on Aggressive Tax Planning
- Press release
- Questions and answers
- Staff Working Document
- Tax Transparency Package
- Action Plan on Corporate Taxation
- Tax good governance in the world as seen by EU countries
Related GITM articles
- Transfer pricing: surviving the new tax world
- BEPS 2015 Final Reports
- EU - Public consultation on further corporate tax transparency
- Improving large business compliance
- Tax administration: large businesses transparency strategy
Written by Richard Cornelisse
I started my career as a manager at Arthur Andersen and then became a partner in EY where I led the indirect tax performance team for Netherlands and Belgium. Currently I am a senior managing director of Key Group.
I have over 20 years’ experience advising clients on international VAT issues. I am specialized in the tax aspects of financial transformations, shared service centre migration, and post merger integration work. I am also somewhat of a mentor, giving back to the profession. If you are interested in conversation and discussion, please feel free to contact me.