- Tax policy and state aid—a new focus for the European Commission
- Original news
- Broadly, what is the Belgian excess profit scheme and how does it work?
- What aspects of the scheme have been identified as state aid?
- How (if at all) does the scheme, and the Commission’s ruling, interact with the principles of transfer pricing? What (if any) are the implications for transfer pricing?
- This is the latest example of the Commission using ‘state aid’ to combat BEPS—do you think tax is an appropriate subject for the application of state aid? Are there any particular difficulties for the Commission when applying principles of state aid to tax cases?
- Do you think Belgium will appeal against the Commission ruling?
- Corporate tax rates are falling as the tax bases broaden and competition between states in tax matters increases—how does the EU propose to control this competition to ensure it remains fair?
- What is the position of the 35+ multinationals affected by the ruling? Assuming they have acted in good faith in accordance with an advance tax ruling, do they have any recourse against having to pay additional tax?
- What, if any, are the wider implications of this ruling?
Tax analysis: Following the European Commission’s announcement that the Belgian excess profit tax scheme is not compatible with state aid rules, James R Modrall, partner at Norton Rose Fulbright LLP, considers the practical implications of the decision.
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