International taxes in brief

Austria introduced the CFC rules. The European Commission will possibly appeal in a Belgian state aid case. Cyprus sets new rules for the determination of interest rates for notional interest deductions. And France introduced a new bill on digital service tax. This is only some of the news that you will read about in the International Tax News.

Austria: introduction of CFC rules
The CFC rule applies to passive income subjected to low or no taxation abroad, whether derived by a CFC or a foreign permanent establishment. An entity is considered low taxed if its actual tax burden abroad is below 12.5 percent. The CFC rules have applied in Austria since 1 January 2019.

European Commission: possible appeal in Belgian state aid case
The EU Competition Commissioner has announced that the European Commission may appeal the European General Court’s 14 February 2019 judgment annulling a 2016 Commission decision that Belgium’s excess profit rulings regime constitutes illegal state aid.

Cyprus: rules for the determination of interest rates for NID
The 10-year government bond yield rates on 31 December 2018 are used to determine the notional interest deduction (NID) on equity for the 2019 tax year.

France: digital service tax
On 6 March 2019, the French government released a bill that would introduce a 3% digital services tax retroactively as from 1 January 2019 and revise the trajectory of the planned progressive reduction of the corporate income tax rate. See more information regarding  digital taxation in a separate article.

Germany: introduction of R&D tax incentive
The Ministry of Finance is considering issuing a legislative proposal that would provide for the introduction of a new research and development (R&D) tax incentive equal to 25% of qualifying expenditure during the four-year period from 2020 to 2023.

Luxembourg: reduction of corporate tax rate
The budget presented on 5 March 2019 includes a proposal to reduce the standard corporate income tax rate from 18% to 17%. If approved, the reduction will apply retroactively from 1 January 2019.

Slovakia: increased of R&D superdeduction
Government proposals announced on 21 February 2019 would increase the super-deduction for companies with qualifying research and development (R&D) expenditure. If approved, the amendments will apply from 2019.

The article is part of dReport – March 2019, Tax news; Grants and investment Incentives.

CFC rules Corporate Income Tax Digital Services Tax Research and development dReport newsletter

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