87 Amendments of José GUSMÃO related to 2023/0321(CNS)
Amendment 74 #
Proposal for a directive
Recital 1
Recital 1
(1) WDespite all the proposals listed in 1a, 1b and 1c, within the Union there is currently no common approach to the computation of the taxable base for businesses. Therefore, Union businesses are obliged to comply with a different corporate tax system in each Member State in which they operate.
Amendment 75 #
Proposal for a directive
Recital 1 a (new)
Recital 1 a (new)
(1a) In 1975, the European Commission tabled a proposal1a to minimize the differences between Member States' corporate tax rates. Under the proposal, Member States could still choose their own corporate tax rate, but this rate could “not be lower than 45 % nor higher than 55 %”. Due to a lack of support from Member States, the proposal was withdrawn. _________________ 1a http://aei.pitt.edu/5570/1/5570.pdf
Amendment 76 #
Proposal for a directive
Recital 1 b (new)
Recital 1 b (new)
(1b) In 2011, the Commission made a proposal1b for a common consolidated corporate tax base, better known under the acronym CCCTB. After four years of technical discussions, negotiations faltered in Council and the proposal was withdrawn. _________________ 1b https://eur-lex.europa.eu/legal- content/EN/TXT/?uri=CELEX:52011PC0 121
Amendment 77 #
Proposal for a directive
Recital 1 c (new)
Recital 1 c (new)
(1c) In 2016, the European Commission tabled an altered 'rebooted' CCCTB1c. A common European corporate tax base would serve as a single rulebook on how companies should calculate their overall profit in the EU. After calculating a common tax base, a company active in more than one Member State could add up all the profits and losses of its entities in the different Member States, to work out its total net profit or loss for the entire EU (consolidation). The company's taxable profits would then be allocated between the respective company entities, using an apportionment formula (formulary apportionment), with the profits being divided according to three equally weighted factors (labour, tangible assets and sales). Each Member State would then tax the allocated shares of the company's profits at its own national corporate tax rate. The 2016 CCCTB proposal eventually met the same fate as its 2011 predecessor. The Council was not able to reach unanimous support and while Council had initially paused negotiations to provide room for the Organisation for Economic Co-operation and Development (OECD)/Inclusive Framework's reform of corporate tax rules (see next paragraph), the 2016 CCCTB proposal was withdrawn in September 2023. _________________ 1c https://eur-lex.europa.eu/legal- content/en/TXT/?uri=CELEX:52016PC06 83
Amendment 80 #
Proposal for a directive
Recital 2
Recital 2
(2) The existence of 27 different corporate income tax systems in the Union gives rise to complexity in tax compliance and leads to unfair competition for businesses, especially because MNEs could use the different tax system in order to engage in aggressive tax planning, leading to SMEs having to pay a higher amount of taxes proportionally to their profits. That has become more evident as globalisation and digitalisation of the economy have significantly altered the perception of land borders and business models. As governments have tried to adapt to that new reality, a fragmented response among Member States has led to further distortions in the internal market. The various legal frameworks inevitably lead to different tax administration practices across the Member States as well. This often entails long procedures characterised by unpredictability and inconsistency along with high compliance costs. Most importantly, it leads to tax avoidance practices by MNEs.
Amendment 85 #
Proposal for a directive
Recital 3
Recital 3
(3) Albeit different in their design, the fundamental features of corporate income tax systems are similar as they lay down rules aiming towards the same objective, i.e., to arrive at a taxable base for businesses. In this vein, it would be important for businesses which operate on the internal market that Member States introduce a common legal framework to harmonise the fundamental features of corporate income tax systems with a view to simplifying tax rules and, ensuring a fair competition and most importantly, fighting against tax avoidance.
Amendment 89 #
Proposal for a directive
Recital 5
Recital 5
(5) The environment for doing business in the internal market should be made more attractive with the aim to stimulate growth and investment in the Union. For this purpose, the enactment of a common framework of corporate tax rules should be prioritised, in order to make it easier for businesses to comply with such rules when they operate across borders and also to encourage those who wish to further expand abroad to do so. A single set of corporate tax rules for international activity is expected to result in enhanced tax certainty and less tax disputes, as it would tackle distortions and decrease the number of cases of double and over-taxation. Furthermore, as tax revenue sustainability is key toMost importantly, harmonisation of rules implies less opportunities for tax avoidance. With an allocation of the taxable base, which is based on tangible factors such as labour, assets and sales, the common framework of corporate tax rules will mitigate aggressive tax planning. Due to the critical importance of sustainable tax revenue for Member States’' budgets, including to invest in infrastructure, research and development and to deliver public services,for instance for the provision of public services, especially for the most vulnerable households, it is essential to ensure that the harmonisation of profit determination rules in the Union will lead to higher effective tax rates and higher revenues for Member States. In addition it would be critical to ensure for the future that the allocation of revenues is performed in accordance with a tool based on solid parameters that cannot be abused.
Amendment 93 #
Proposal for a directive
Recital 6
Recital 6
(6) It is indeed critical to create a system that achieves a degree of uniformity across the Union, at least amongst the taxpayers that it is chiefly addressed to. Accordingly, and considering the efforts that both tax administrations and businesses have made in order to implement the framework of a global minimum level of taxation, it would be important to capitalise on this achievement and design rules that remain as close as possible to the OECD/G20 Model Rules and Directive (EU) 2022/2523. On this basis, the common framework of rules should be mandatory for groups with a taxable presence in the Union provided that they have annual combined revenues of more than EUR 750 000 00040 000 000 or more, in line with the definition of large groups within the meaning of Directive 2013/34/EU of the European Parliament and of the Council6a based on their consolidated financial statements. In this way, the scope would thus be targeted at businesses that are most likely to have cross-border activities and, thereby, can benefit from the simplification which a common legal framework would offer. The threshold would also provide alignment with Directive (EU) 2022/2523 for a consistent approach in the Union. _________________ 6a Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182 29.6.2013, p. 19).
Amendment 97 #
Proposal for a directive
Recital 7
Recital 7
Amendment 99 #
Proposal for a directive
Recital 7 a (new)
Recital 7 a (new)
(7a) The European Union should engage in international negotiations, in order to generalize this harmonisation of rules and allocation of the taxable base (with a formula based on tangible factors such as labour, assets and sales).
Amendment 100 #
Proposal for a directive
Recital 7 b (new)
Recital 7 b (new)
(7b) In order to avoid delocalisation of profits outside of the EU by MNEs, BEFIT groups should also declare their global profit at the international level. Then, the formula used in this Directive would also be used to compare the profits originally declared in the EU and the ones which would have been declared if the formula was applied on the global profit of the BEFIT group. If the corrected profits are higher than the declared one, the EU will tax those corrected profits thanks to the formula approach included in this Directive.
Amendment 101 #
Proposal for a directive
Recital 7 c (new)
Recital 7 c (new)
(7c) To fight against global tax avoidance, Member States could also unilaterally collect the tax deficit of multinationals: the difference between what a corporation pays in taxes globally and what it would have to pay if all of its profits were subject to a minimum tax rate in each of the countries in which it operates. Such a solution could encourage other states to follow this move and progressively lead to an ambitious global solution.
Amendment 102 #
Proposal for a directive
Recital 8
Recital 8
Amendment 109 #
Proposal for a directive
Recital 10 a (new)
Recital 10 a (new)
(10a) A fair taxation of passive income such as interest is required. It is therefore appropriate to lay down an interest limitation rule applicable to BEFIT group members in such a way as to reduce the debt-equity bias that can occur via an over-reliance to intra-group debt financing and to reduce the scope for base erosion and profit shifting through excessive interest payments.
Amendment 110 #
Proposal for a directive
Recital 10 b (new)
Recital 10 b (new)
(10b) To guarantee a minimal level of taxation of royalties, a royalties limitation rule for BEFIT group members should be introduced in accordance with the Subject to Tax Rule10a as proposed by the OECD/G20 Inclusive Framework in Pillar II. _________________ 10a OECD (2023). Tax Challenges Arising from the Digitalisation of the Economy – Subject to Tax Rule (Pillar Two): Inclusive Framework on BEPS, OECD/G20 Base Erosion and Profit Shifting Project, OECD Publishing, Paris, https://doi.org/10.1787/9afd6856-en
Amendment 113 #
Proposal for a directive
Recital 10 c (new)
Recital 10 c (new)
(10c) A fairer taxation of passive income also requires robust Controlled Foreign Company (CFC) rules for BEFIT group members in order to make them more resilient against profit shifting.
Amendment 115 #
Proposal for a directive
Recital 11
Recital 11
Amendment 116 #
Proposal for a directive
Recital 12
Recital 12
(12) To achieve the key objective of creating a simplified corporate tax framework, the preliminary tax results for each group member should be aggregated into one single common tax base, in order to subsequently allocate this base to eligible group members. The tax adjustments to the financial statements would produce preliminary tax results for each group member. These results would then be aggregated, which would allow for cross-border loss relief between BEFIT group members, and subsequently, the aggregated tax base would be allocated to group members based on a transition allocation rule; this would pave the way towards a permanent mechanism. That permanent mechanism could be based on a formulary apportionment and would render the need for intra-BEFIT group transactions to be consistent with the arm’s length principle redundant. It would have the advantage of using more recent country-by-country reporting (‘CbCR’) data and the information gathered during the transition period. This will also allow for a more thorough assessment of the impact that the implementation of the two-pillar approach is expected to have on national tax bases and the BEFIT group tax bases. In this way, it would still become possible to materialise the key objective of tax neutrality in the internal market, which would reduce instances of double and over-taxation and enhance tax certainty with the aim of reducing the number of tax disputesformulary apportionment including three sets of tangible factors: labour, assets, and sales. It will render the need for intra-BEFIT group transactions to be consistent with the arm’s length principle redundant.
Amendment 126 #
Proposal for a directive
Recital 13
Recital 13
(13) The aggregation of the tax results amongst group members would not be a suitable measure for certain sectors, such as extractive activities as well as international shipping, inland waterways transport and air transport. It would therefore be important to exclude those from the aggregation as their characteristics do not fit in such context. Any amount of the profit or loss of companies that operate in the field of international traffic which is not covered by a tonnage tax regime (and thus excluded from the preliminary tax results), would have to be kept out of the aggregation while it would be computed by applying the common corporate tax rules.
Amendment 128 #
Proposal for a directive
Recital 14
Recital 14
Amendment 135 #
Proposal for a directive
Recital 16
Recital 16
Amendment 136 #
Proposal for a directive
Recital 17
Recital 17
(17) A common framework for corporate taxation would necessarily feature an administration system, which should ideally provide for a degree of tax certainty and simplification. To promote uniformity, the administration system would have to build on the importance of operating a centralised point of reference for dealing with a number of common issues, such as an Information Return for the entire group, and ensuring an adequate degree of coordination and collaboration amongst national tax administrations. At the same time, the administration system should fully respect national tax sovereignty as local tax returns, audits and dispute settlement would have to remain primarily at the level of the Member States.
Amendment 139 #
Proposal for a directive
Recital 18
Recital 18
(18) To ensure that the rules of the common framework are implemented and enforced correctly, Member States should lay down rules on penalties applicable to infringements of national provisions adopted pursuant to this Directive. Such penalties should be effective, proportionate and dissuasive. Those penalties should be set at a minimum rate of 0,5 % of the turnover of the BEFIT group in case of failure to file the BEFIT information return accordingly.
Amendment 142 #
Proposal for a directive
Recital 19
Recital 19
(19) To optimise the benefits of having a common legal framework for computing the corporate tax base in the internal market, the application of the rules should be optional for groups, including SME groups, who earn annual combined revenues of less than EUR 7540 000 000 as long as they prepare consolidated financial statements and have a taxable presence in the Union. By keeping the application of the rules open to groups of a smaller size, more groups with cross-border structures and activities may benefit from the simplification that the common framework offers.
Amendment 153 #
Proposal for a directive
Article 1 – paragraph 2 – point c
Article 1 – paragraph 2 – point c
(c) for allocating the BEFIT tax base to eligible BEFIT group members based on a formulary apportionment described in article 45a ;
Amendment 158 #
Proposal for a directive
Article 2 – paragraph 1 – point a
Article 2 – paragraph 1 – point a
(a) they belong to a domestic group or to a multinational enterprise group (‘MNE group) which prepares consolidated financial statements and had annual combined revenues of EUR 7540 000 000 or more in at least two of the last four fiscal years;
Amendment 163 #
Proposal for a directive
Article 2 – paragraph 2
Article 2 – paragraph 2
2. By way of derogation from paragraph 1, this Directive shall not apply to companies or permanent establishments with an ultimate parent entity outside the Union where the combined revenues of the group in the Union either do not exceed 52% of the total revenues for the group based on its consolidated financial statements or the amount of EUR 520 million in at least two of the last four fiscal years. This shall be without prejudice to the right of opting in under paragraph 7.
Amendment 166 #
Proposal for a directive
Article 2 – paragraph 3
Article 2 – paragraph 3
3. Where two or more groups merge to form a single group, the threshold of EUR 7540 000 000 referred to in paragraph 1 shall be deemed to be met for any fiscal year prior to the merger if the sum of the combined revenues of the merging groups for that fiscal year, as included in each of their consolidated financial statements, is EUR 7540 000 000 or more. The companies and permanent establishments members of that newly formed group shall become subject to this Directive if that threshold was met in at least two of the last four fiscal years.
Amendment 169 #
Proposal for a directive
Article 2 – paragraph 4
Article 2 – paragraph 4
4. Where a company that is not a member of a group (the ‘target’) is acquired by another company or a group (the ‘acquiring entity’) and either the target or the acquiring entity did not have consolidated financial statements in any of the four fiscal years immediately preceding the fiscal year of the acquisition, the threshold of annual combined revenues of EUR 7540 000 000 referred to in paragraph 1 shall be deemed to be met for that year if the sum of the revenues included in the financial statements or consolidated financial statements of the target and the acquiring entity for that fiscal year is EUR 7540 000 000 or more. The acquiring entity shall become subject to this Directive if that threshold was met in at least two of the four fiscal years immediately preceding the fiscal year in which this Directive started to apply to the acquiring entity.
Amendment 172 #
Proposal for a directive
Article 2 – paragraph 5 – introductory part
Article 2 – paragraph 5 – introductory part
5. Where there is a demerger of a group into two or more groups (the ‘demerged groups’), the threshold of EUR 7540 000 000 referred to in paragraph 1 shall be deemed to be met by each of the demerged groups where:
Amendment 175 #
Proposal for a directive
Article 2 – paragraph 5 – point a
Article 2 – paragraph 5 – point a
(a) in the first fiscal year ending after the demerger, each of the demerged groups has annual combined revenues of EUR 7540 000 000 or more in that fiscal year;
Amendment 177 #
Proposal for a directive
Article 2 – paragraph 5 – point b
Article 2 – paragraph 5 – point b
(b) in the second to fourth fiscal years ending after the demerger, each of the demerged groups has annual combined revenues of EUR 7540 000 000 or more in at least two of those fiscal years.
Amendment 179 #
Proposal for a directive
Article 2 – paragraph 7
Article 2 – paragraph 7
7. Member States shall ensure that companies which are resident for tax purposes in a Member State and fulfil the conditions laid down in paragraph 1, point (b), including their permanent establishments located in other Member States, as well as permanent establishments, located in Member States, of third-country entities which fulfil the conditions of paragraph 1, point (c), may choose to be covered by this Directive if they belong to an MNE group or domestic group which prepares consolidated financial statements but does not fulfil the conditions laid down in paragraph 1, point (a) regarding the threshold of EUR 7540 000 000.
Amendment 185 #
Proposal for a directive
Article 3 – paragraph 1 – point 15
Article 3 – paragraph 1 – point 15
(15) ‘economic owner’ means the person who receives substantially allmost of the benefits and bears allmost of the risks attached to a fixed asset, regardless of whether that person is the legal owner. A taxpayer who has the right to possess, use and dispose of a fixed asset and bears the risk of its loss or destruction shall in any event be considered the economic owner;
Amendment 187 #
Proposal for a directive
Article 5 – paragraph 1 – point a
Article 5 – paragraph 1 – point a
(a) the company is either the ultimate parent entity of the group or any other company of the group in which the ultimate parent entity holds, directly or indirectly, at least 725% of the ownership rights or of the rights giving entitlement to profit;
Amendment 190 #
Proposal for a directive
Article 5 – paragraph 2 a (new)
Article 5 – paragraph 2 a (new)
2a. A company or a permanent establishment shall become a BEFIT group member on the date that the thresholds referred to in (1) are reached.
Amendment 191 #
Proposal for a directive
Article 6
Article 6
Amendment 194 #
Proposal for a directive
Article 8
Article 8
Amendment 198 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
Amendment 202 #
Proposal for a directive
Article 11
Article 11
Amendment 205 #
Proposal for a directive
Article 13 – paragraph 1
Article 13 – paragraph 1
1. A BEFIT group member shall adjust its financial accounting net income or loss to include the amount of exceeding borrowing costs, as referred to in Article 2 of Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market11 , which is not deductible for tax purposes in accordance with the interest limitation rules laid down in the national corporate tax law of the Member State where it is resident for tax purposes. _________________ 11 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1)which is not deductible for tax purposes in accordance with paragraph 1a.
Amendment 207 #
Proposal for a directive
Article 13 – paragraph 1 a (new)
Article 13 – paragraph 1 a (new)
1a. For the purpose of this article, ‘exceeding borrowing costs’ means the amount by which the deductible borrowing costs of a taxpayer exceed taxable interest revenues and other economically equivalent taxable revenues that the taxpayer receives according to national law. Exceeding borrowing costs shall be deductible up to 75 % in the tax period in which they are incurred. If such amount is higher than 20 % of the taxpayer's earnings before interest, tax, depreciation, and amortisation (EBITDA), the taxpayer is entitled to deduct only the lower of the two amounts in the tax period. The difference between the two amounts shall not be carried forward or back.
Amendment 209 #
Proposal for a directive
Article 13 – paragraph 2
Article 13 – paragraph 2
Amendment 213 #
Proposal for a directive
Article 15 – paragraph 1
Article 15 – paragraph 1
Amendment 218 #
Proposal for a directive
Article 21 a (new)
Article 21 a (new)
Article 21a Controlled Foreign Companies 1. The financial accounting net income or loss of a BEFIT group member shall be adjusted to include: (a) the non-distributed income of an entity or permanent establishment which is derived from the following categories: (i) interest or any other income generated by financial assets; (ii) royalties or any other income generated from intellectual property; (iii) dividends and income from the disposal of shares; (iv) income from financial leasing; (v) income from insurance, banking, and other financial activities; (vi) income from invoicing companies that earn sales and services income from goods and services purchased from and sold to associated enterprises, and add no or little economic value; The first subparagraph shall not apply where the controlled foreign company carries out a substantive economic activity supported by staff, equipment, assets, and premises, as evidenced by relevant facts and circumstances. Where the controlled foreign company is resident or situated in a third country that is not party to the EEA Agreement, Member States may decide to refrain from applying the first subparagraph. (b) the non-distributed income of the entity or permanent establishment arising from non-genuine arrangements which have been put in place for the essential purpose of obtaining a tax advantage. For the purposes of this point, an arrangement or a series thereof shall be regarded as non-genuine to the extent that the entity or permanent establishment would not own the assets or would not have undertaken the risks which generate all, or part of, its income if it were not controlled by a company where the significant people functions, which are relevant to those assets and risks, are carried out and are instrumental in generating the controlled company's income. 2. The income to be included in the tax base shall be calculated according to Article 8 of Directive (EU) 2016/1164.
Amendment 222 #
Proposal for a directive
Article 22 – paragraph 1
Article 22 – paragraph 1
1. The financial accounting net income or loss of a BEFIT group member shall be adjusted to exclude in the fiscal year of acquisition any fixed tangible asset that has a book value before depreciation which is below EUR 5000.
Amendment 223 #
Proposal for a directive
Article 22 – paragraph 2 – point a
Article 22 – paragraph 2 – point a
(a) all buildings as well as any other type of immovable property and structure in use for the business: 2850 years;
Amendment 227 #
Proposal for a directive
Article 22 – paragraph 2 – point b
Article 22 – paragraph 2 – point b
(b) all other fixed tangible assets: their useful life as assessed in accordance with the acceptable accounting standard in the Union referred to in Article 7;, but not less than 5 years.
Amendment 231 #
Proposal for a directive
Article 22 – paragraph 2 – point c
Article 22 – paragraph 2 – point c
(c) fixed intangible assets, including acquired goodwill: the period for which the asset enjoys legal protection or for which the right has been granted and, where that period cannot be determined, 520 years.
Amendment 237 #
Proposal for a directive
Article 22 – paragraph 5 a (new)
Article 22 – paragraph 5 a (new)
5a. Member States are not allowed to grant further entitlement to depreciate to a BEFIT group member other than those specified in this Section.
Amendment 253 #
Proposal for a directive
Article 37 – paragraph 3 – subparagraph 4
Article 37 – paragraph 3 – subparagraph 4
Amendment 254 #
Proposal for a directive
Article 38
Article 38
Amendment 258 #
Proposal for a directive
Article 41 – paragraph 1 – subparagraph 2
Article 41 – paragraph 1 – subparagraph 2
Amendment 260 #
Proposal for a directive
Article 42 – title
Article 42 – title
Computation of the BEFIT EU tax base
Amendment 261 #
Proposal for a directive
Article 42 – paragraph 2 – introductory part
Article 42 – paragraph 2 – introductory part
2. Where the BEFIT EU tax base in a given year is:
Amendment 262 #
Proposal for a directive
Article 42 – paragraph 2 – point a
Article 42 – paragraph 2 – point a
(a) a positive amount, the profit shall be allocated in accordance with the rule set under Article 45a;
Amendment 263 #
Proposal for a directive
Article 42 – paragraph 2 – point b
Article 42 – paragraph 2 – point b
Amendment 266 #
Proposal for a directive
Article 42 a (new)
Article 42 a (new)
Article 42a Computation of the BEFIT Global tax base 1. Where possible, all BEFIT groups shall declare a global consolidated tax base, aggregating the financial result of all group members, located in Member States and in third-country jurisdictions. 2. The BEFIT EU tax base described under article 42 shall be corrected upward accordingly in case the amount resulting from paragraph 1 is higher. 3. Where the BEFIT tax base in a given year is a positive amount, the profit shall be allocated in accordance with the rule set under Article 45a.
Amendment 267 #
Proposal for a directive
Article 43 – paragraph 1
Article 43 – paragraph 1
Amendment 268 #
Proposal for a directive
Article 44 – paragraph 1
Article 44 – paragraph 1
1. Where a BEFIT group member derives income that has been taxed in another Member State or in a third country, a tax credit shallcan be granted in line with the applicable double taxation convention or its national law and shared amongst the BEFIT group members using the baseline allocation method referred to in Article 45, as long as a minimum level of effective taxation is guaranteed.
Amendment 269 #
Proposal for a directive
Article 45
Article 45
Amendment 319 #
Proposal for a directive
Article 45 a (new)
Article 45 a (new)
Article 45a Allocation rule based on tangible factors 1. As of 1 July 2026, the BEFIT tax base shall be allocated to the BEFIT group members in each tax year on the basis of a formula that gives equal weight to the factors of sales, labour, and assets according to Articles 45b to 45i: Share A = (SalesA / (3 * SalesGroup) + PayrollA / (6 * PayrollGroup) + No.EmployeesA / (6 * No.EmployeesGroup) + AssetsA/ (3* AssetsGroup) ) * Con'dTaxBase 2. The consolidated tax base of a BEFIT group shall be shared only where it is positive. 3. The calculations for sharing the consolidated tax base shall be done at the end of the tax year of the BEFIT group. 4. A period of 15 days or more in a calendar month shall be considered as a whole month. 5. When determining the apportioned share of a BEFIT group member, equal weight shall be given to the factors of sales, labour, and assets.
Amendment 320 #
Proposal for a directive
Article 45 b (new)
Article 45 b (new)
Article 45b Composition of the labour factor 1. The labour factor shall consist, as to one half, of the total amount of the payroll of a BEFIT group member as its numerator and the total amount of the payroll of the BEFIT group as its denominator, and as to the other half, of the number of employees of a BEFIT group member as its numerator and the number of employees of the BEFIT group as its denominator. Where an individual employee is included in the labour factor of a BEFIT group member, the payroll relating to that employee shall be allocated to the labour factor of the same BEFIT group member. 2. The number of employees shall be measured at the end of the tax year. 3. The definition of an employee shall be determined by the national law of the Member State where the employment is exercised.
Amendment 321 #
Proposal for a directive
Article 45 c (new)
Article 45 c (new)
Article 45c Allocation of employees and payroll 1. Employees shall be included in the labour factor of the group member from which they receive remuneration. Employees with all types of contracts should be included. 2. By way of derogation from paragraph 1, where employees physically exercise their employment under the control and responsibility of an entity other than that from which they receive remuneration, those employees as well as the amount of payroll related to them shall be included in the labour factor of the former entity. This rule shall only apply where all of the following conditions are met: (a) the employment lasts for an uninterrupted period of at least three months; (b) those employees represent at least 5 % of the overall number of employees of the group member from which they receive remuneration. 3. Employees shall include persons who, although not employed directly by a BEFIT group member, perform tasks similar to those performed by employees. 4. Payroll shall include all costs of salaries, wages, bonuses and all other employee compensation, including related pension and social security costs borne by the employer as well as expenses of the employer corresponding to the cost of persons as referred to in paragraph 3. 5. Payroll costs shall be valued at the amount of expenses that are treated as deductible by the employer in a tax year.
Amendment 322 #
Proposal for a directive
Article 45 d (new)
Article 45 d (new)
Article 45d Composition of the asset factor 1. The asset factor shall consist of the average value of all fixed tangible assets owned, rented or leased by a BEFIT group member as its numerator and the average value of all fixed tangible assets owned, rented or leased by the group as its denominator. 2. In the five years that follow a taxpayer joining an existing or new BEFIT group, its asset factor shall also include the total amount of costs incurred for research, development, marketing, and advertising by the taxpayer over the six years that preceded its joining the group.
Amendment 323 #
Proposal for a directive
Article 45 e (new)
Article 45 e (new)
Article 45e Allocation of assets 1. Without prejudice to Article 22(2) and (3), an asset shall be included in the asset factor of its economic owner. Where the economic owner cannot be identified, the asset shall be included in the asset factor of the legal owner. However, an asset that is not effectively used by its economic owner shall be included in the factor of the BEFIT group member that effectively uses that asset, provided that the asset represents more than 5 % of the value for tax purposes of all fixed tangible assets of the BEFIT group member that effectively uses it. 2. Except in the case of leases between BEFIT group members, leased assets shall be included in the asset factor of the BEFIT group member that is the lessor or the lessee of the asset. The same shall apply to rented assets.
Amendment 324 #
Proposal for a directive
Article 45 f (new)
Article 45 f (new)
Article 45f Valuation 1. Land and other non-depreciable fixed tangible assets shall be valued at their original cost. 2. An individually depreciable fixed tangible asset shall be valued at the average of its value for tax purposes at the beginning and at the end of a tax year. Where, as a result of one or more intra- group transactions, an individually depreciable fixed tangible asset is included in the asset factor of a BEFIT group member for less than a tax year, the value to be taken into account shall be calculated having regard to the number of months that the asset was included in the asset factor of that BEFIT group member. 3. The renter or lessee of an asset of which it is not the economic owner shall value that rented or leased asset at eight times the net annual rental or lease payment due, less any amounts receivable from sub-rentals or sub-leases. A BEFIT group member renting out or leasing an asset of which it is not its economic owner shall value that rented or leased asset at eight times the net annual rental or lease payment due. 4. An asset sold by a BEFIT group member to a person outside the BEFIT group following an intra-group transfer in the same or the previous tax year shall be included in the asset factor of the transferring BEFIT group member for the period between the intra-group transfer and the sale to the person outside the BEFIT group, except where the BEFIT group members concerned demonstrate that the intra-group transfer was made for genuine commercial reasons.
Amendment 325 #
Proposal for a directive
Article 45 g (new)
Article 45 g (new)
Article 45g Composition of the sales factor 1. The sales factor shall consist of the total sales allocated to a BEFIT group member as its numerator and the total sales of the BEFIT group as its denominator.
Amendment 326 #
Proposal for a directive
Article 45 h (new)
Article 45 h (new)
Article 45h Sales by destination 1. Sales of goods shall be included in the sales factor of the BEFIT group member located in the Member State where the dispatch or transport of the goods to the person acquiring them ends. Where that place cannot be determined, the sales of goods shall be attributed to the BEFIT group member located in the Member State of the last identifiable location of the goods. 2. Supplies of services shall be included in the sales factor of the BEFIT group member located in the Member State where the services are physically carried out or actually supplied. 3. Where there is no BEFIT group member in the Member State where the goods are delivered or the services are supplied, or where goods are delivered or services are supplied in a third country, the sales of goods and supplies of services shall be included in the sales factor of all BEFIT group members in proportion to their labour and asset factors. 4. Where there is more than one BEFIT group member in the Member State where the goods are delivered or the services are supplied, the sales shall be included in the sales factor of all BEFIT group members located in that Member State in proportion to their labour and asset factors.
Amendment 327 #
Proposal for a directive
Article 46 – paragraph 1 – subparagraph 1
Article 46 – paragraph 1 – subparagraph 1
By way of derogation from Articles 42 to 45a, where a BEFIT group member conducts its principal business in the field of extractive activities, its revenues, expenses and other deductible items which stem from such activities shall be attributed to the BEFIT group member located in the Member State where the extraction takes place.
Amendment 328 #
Proposal for a directive
Article 46 – paragraph 2
Article 46 – paragraph 2
2. By way of derogation from Article 42 to 45a, where there is no BEFIT group member in the Member State of extraction, or where the extraction takes place in a third country jurisdiction, the revenues, expenses and other deductible items which stem from such activities shall be attributed to the BEFIT group member to which they accrued.
Amendment 330 #
Proposal for a directive
Article 47
Article 47
Amendment 333 #
Proposal for a directive
Article 48
Article 48
Amendment 337 #
Proposal for a directive
Article 48 a (new)
Article 48 a (new)
Article 48a Output-based incentives A Member State providing incentives for research and development should not offer output-based incentives, such as patent boxes, which would decrease the allocated part of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State.
Amendment 339 #
Proposal for a directive
Article 50
Article 50
Amendment 341 #
Proposal for a directive
Article 51
Article 51
Amendment 343 #
Proposal for a directive
Article 52
Article 52
Amendment 345 #
Proposal for a directive
Article 53
Article 53
Amendment 349 #
Proposal for a directive
Article 57 – paragraph 3 – point d – point ii
Article 57 – paragraph 3 – point d – point ii
(ii) the BEFIT EU tax base and the BEFIT global tax base;
Amendment 350 #
Proposal for a directive
Article 57 – paragraph 3 a (new)
Article 57 – paragraph 3 a (new)
3a. All supporting documentation that was used to build the BEFIT tax base referred to in paragraph 3, point (d)(ii) shall be kept for at least ten years to be made available to the competent authorities of all Member States in which the BEFIT group members are resident for tax purposes or situated in the form of a permanent establishment.
Amendment 355 #
Proposal for a directive
Chapter V – Section 4
Chapter V – Section 4
Amendment 359 #
Proposal for a directive
Article 65 – paragraph 6
Article 65 – paragraph 6
6. Notwithstanding paragraph 5, no amended tax assessment shall be issued, in order to adjust the BEFIT tax base, where the difference between the initially declared BEFIT tax base and the revised BEFIT tax base does not exceed the lower of EUR 102 000 or 10,5% of the BEFIT tax base.
Amendment 363 #
Proposal for a directive
Article 68 – paragraph 4
Article 68 – paragraph 4
4. Notwithstanding paragraph 3, no amended tax assessment shall be issued in order to adjust the BEFIT tax base, where the difference between the initially declared BEFIT tax base and the revised BEFIT tax base does not exceed the lower of EUR 102,000 or 10,5% of the BEFIT tax base.
Amendment 366 #
Proposal for a directive
Article 70 – paragraph 1
Article 70 – paragraph 1
Where the outcome of an administrative or judicial appeal requires amendments to the individual tax assessment of one or more member of athe BEFIT group, Member States shall take the appropriate measures to ensure that such amendments remain possible, notwithstanding any time limits in the domestic laws of Member State in a time frame of 10 years.
Amendment 369 #
Proposal for a directive
Article 72 – paragraph 1 a (new)
Article 72 – paragraph 1 a (new)
Penalties shall be set at a minimum of 0,5 % of the turnover of the BEFIT group in case of failure to file the BEFIT information return in accordance with Article 59.
Amendment 382 #
Proposal for a directive
Article 78 – paragraph 1
Article 78 – paragraph 1
1. Member States shall adopt and publish the laws, regulations and administrative provisions necessary to comply with this Directive by 1 January 20286. They shall forthwith communicate to the Commission the text of those provisions.
Amendment 385 #
Proposal for a directive
Article 78 – paragraph 2
Article 78 – paragraph 2
2. They shall apply those provisions from 1 July 20286.