On February 27, 2014, Attorney-General Kokott (AG) of the Court of Justice of the European Union (CJEU) issued her opinion in the SCA Group Holding joined cases (C-39/13, C-40/13, and C-41/13). The Advocate General concluded that the Dutch rules are in breach of the freedom of establishment insofar as they deny tax consolidation between a Dutch parent company and a Dutch sub-subsidiary held through a foreign subsidiary, or between two Dutch sister subsidiaries and their foreign parent company. The CJEU now has to rule on the case. For further information, read our Euro Tax Flash and the February 2014 report (PDF 73 KB) prepared by the KPMG member firm in the Netherlands.
On February 26, 2014, the European Parliament and the Council reached agreement to amend the existing accounting legislation 2013/34/EU, which will make it mandatory for certain large companies to disclose non-financial and diversity information. It was agreed that any updates to country-by-country tax reporting would be based on a European Commission report, due for release in July 2018, which will take into account international developments on this issue. In order to become law, the Commission's proposal needs to be adopted jointly by the European Parliament and by the EU Member States in the Council (which votes by qualified majority). It is expected that the European Parliament will vote on this legislation in plenary session in April, after which the Council will formally adopt it.
On March 3, 2014, the OECD published the comments received on its Discussion Draft on transfer pricing documentation and country-by-country reporting, which can be accessed through the following link to their site.
On February 20, 2014, the OECD released a revised timeline for action relating to base erosion and profit shifting (BEPS) discussion drafts and public consultations. The first output from the BEPS project is expected in September 2014, with completion of the project due in 2015. The revised timetable provides the dates on which discussion drafts will be published and public consultations held in relation to the September 2014 actions.
The discussion drafts set for release and the dates on which they will be released are:
- Tax treaty abuse – March 17, 2014
- Tax challenges of the digital economy – March 24, 2014
- Hybrid mismatch arrangements – April 4, 2014
In February 2014, the Federal Department of Finance published the annual Report on international financial and tax matters 2014 (PDF 2.33 MB). Regarding international tax, the report notes Switzerland's activities in this field in respect of multilateral cooperation, such as the signing of the multilateral Convention on Mutual Administrative Assistance in Tax Matters, within the EU, e.g. the start of negotiations on revising the agreement with the EU on taxation of savings and in respect of bilateral relations, e.g. the tax agreements with Austria and the United Kingdom which took effect as of January 1, 2013.
A "corporate report" has been issued by the UK tax authorities (HMRC), which sets out how offshore tax evasion is addressed in the UK and internationally.
Read a February 2014 report (PDF 696 KB) prepared by the KPMG member firm in the UK: Weekly Tax Briefing (28 February 2014).