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Inside the EU Code of Conduct Group : 20 Years of Tackling Harmful Tax Competition.

This book analyses the functioning and effectiveness of the diplomatic EU Code of Conduct Group in tackling harmful tax competition in the European Union.

Bibliographic Details
Main Author: Nouwen, Martijn F.
Format: eBook
Language:English
Published: Amsterdam : IBFD Publications USA, Incorporated, 2021.
Edition:1st ed.
Subjects:
Business enterprises > Taxation.
European Union countries.
Electronic books.
Online Access:Click to View
Table of Contents:
  • Cover
  • IBFD Doctoral Series
  • Title
  • Copyright
  • Table of Contents
  • Abbreviations
  • Chapter 1 Introduction
  • 1.1. Motivation and relevance
  • 1.2. Research question
  • 1.3. Method, delimitations and documents used
  • 1.4. Outline
  • Chapter 2 The Preparatory Works and the Drafting of the Code
  • 2.1. Introduction
  • 2.2. The Ruding Report on the need to tackle harmful tax competition
  • 2.3. The First Monti Memorandum and the need for a global approach to tax issues
  • 2.4. The Second Monti Memorandum and the need to develop a code to tackle harmful tax competition
  • 2.5. The drafting of the first compromise proposal for the Code
  • 2.6. "Agreement in principle" on the Council's first compromise proposal for the Code
  • 2.7. The Third Monti Memorandum and the drafting of the second and third compromise proposals for the Code
  • 2.8. Discussion on the third compromise proposal for the Code by the Council
  • 2.9. The Fourth Monti Memorandum and the drafting of the fourth compromise proposal for the Code
  • 2.10. Paving the way for political agreement on the Code
  • 2.11. Political agreement on the Code by the Council
  • 2.12. Summary and conclusions
  • Chapter 3 The Legal Status of the Code
  • 3.1. Introduction
  • 3.2. Soft law: An informal para and pre-law steering instrument
  • 3.3. Soft law: Soft governance to tackle harmful tax competition
  • 3.4. The Open Method of Coordination
  • 3.5. The Code of Conduct for Business Taxation as an OMC in disguise?
  • 3.5.1. OMC features in the area of pseudo-case law
  • 3.5.2. OMC features in the area of pseudo-legislation
  • 3.6. Summary and conclusions
  • Chapter 4 The Governance and Working Methods of the Code of Conduct Group
  • 4.1. Introduction: The parties involved in the Code of Conduct Group's decision-making process
  • 4.2. The Code of Conduct Group (Business Taxation) itself.
  • 4.2.1. A preparatory Council working group
  • 4.2.2. The mandate of the Code of Conduct Group
  • 4.2.3. The governance of the Code of Conduct Group
  • 4.2.3.1. Introduction
  • 4.2.3.2. Governance and Member State representation
  • 4.2.3.3. Decision-making
  • 4.2.3.4. Confidentiality
  • 4.2.4. The working methods of the Code of Conduct Group
  • 4.2.4.1. Introduction
  • 4.2.4.2. Pseudo-case law practice
  • 4.2.4.2.1. Phase 1: Standstill notification phase
  • 4.2.4.2.2. Phase 2: Agreed description phase
  • 4.2.4.2.3. Phase 3: Formal assessment phase
  • 4.2.4.2.4. Phase 4: Rollback notification and monitoring phase
  • 4.2.4.3. Pseudo-legislation practice
  • 4.2.4.3.1. Phase 1: Drafting phase
  • 4.2.4.3.2. Phase 2: Adoption and publication phase
  • 4.2.4.3.3. Phase 3: Implementation phase
  • 4.2.4.3.4. Phase 4: Monitoring phase
  • 4.3. The role of Code of Conduct SubGroups
  • 4.4. The role of other high-level working groups
  • 4.5. The role of the European Commission
  • 4.6. The role of the European Parliament
  • 4.7. The role of the Council Secretariat
  • 4.8. The role of Coreper
  • 4.9. The role of the Ecofin Council
  • 4.10. Summary and conclusions
  • Chapter 5 The Geographical Scope of the Code
  • 5.1. Introduction
  • 5.2. Member States
  • 5.3. Outermost Regions
  • 5.4. European territories for whose external relations a Member State is responsible
  • 5.5. Overseas Countries and Territories
  • 5.6. Special cases: Small islands
  • 5.7. Third countries
  • 5.8. Summary and conclusions
  • Chapter 6 The Substantive Scope of the Code
  • 6.1. Introduction
  • 6.2. A four-step assessment of the harmfulness of preferential tax regimes
  • 6.3. Step 1: Is the tax regime within scope?
  • 6.3.1. Introduction: Taxes covered
  • 6.3.2. "Business taxation"
  • 6.3.2.1. Introduction
  • 6.3.2.2. Indirect taxation
  • 6.3.2.3. Individual income taxation.
  • 6.3.2.4. Excluded business sectors: Shipping and financial services
  • 6.3.3. "Measures"
  • 6.3.4. "Affect or may affect in a significant way"
  • 6.3.5. "Business activity"
  • 6.3.6. "In the Community"
  • 6.4. Step 2: Is the tax regime potentially harmful?
  • 6.4.1. Introduction: The gateway criterion
  • 6.4.2. "A significantly lower level of taxation", "the effective level of taxation", "zero taxation" and "the normal level of taxation"
  • 6.4.3. Application
  • 6.4.4. Revision
  • 6.5. Step 3: Is the tax regime actually harmful?
  • 6.5.1. Introduction: The assessment criteria
  • 6.5.2. Ring-fencing I
  • 6.5.2.1. Definition
  • 6.5.2.2. Application
  • 6.5.2.2.1. De jure assessment
  • 6.5.2.2.2. De facto assessment
  • 6.5.3. Ring-fencing II
  • 6.5.3.1. Definition
  • 6.5.3.2. Application
  • 6.5.4. Substance criterion
  • 6.5.4.1. Definition
  • 6.5.4.2. Application
  • 6.5.5. Profit determination criterion
  • 6.5.5.1. Definition
  • 6.5.5.2. Application
  • 6.5.6. Transparency criterion
  • 6.5.6.1. Definition
  • 6.5.6.2. Application
  • 6.6. Step 4: Is the harmful tax regime nevertheless justified?
  • 6.6.1. Introduction: Justifications
  • 6.6.2. Absence of harmful effects on other Member States' economies
  • 6.6.3. Supporting the economic development of underdeveloped regions
  • 6.6.4. Ensuring the competitiveness of SMEs and of certain sectors
  • 6.6.5. Precedent
  • 6.7. Summary and conclusions
  • Chapter 7 Discussion and Assessment of the Pseudo-Case Law of the Code of Conduct Group
  • 7.1. Introduction
  • 7.2. Generic corporate tax regimes
  • 7.2.1. Overview
  • 7.2.2. The Gibraltar Tax exemption regime for passive income
  • 7.2.3. The Gibraltar Tax treatment of asset-holding companies
  • 7.2.4. The Isle of Man Retail tax regime
  • 7.3. Shareholder tax regimes
  • 7.3.1. Overview
  • 7.3.2. The Aruban Imputation payment company regime.
  • 7.3.3. The Maltese Advance company income tax and refunds regime
  • 7.3.4. The Isle of Man Distributable profits charge regime
  • 7.3.5. The Jersey Deemed distribution and attribution regime
  • 7.4. Interest regimes
  • 7.4.1. Overview
  • 7.4.2. Interest deduction regimes
  • 7.4.2.1. Actual deduction regimes
  • 7.4.2.2. Deemed deduction regimes
  • 7.4.3. Tax rate regimes
  • 7.4.3.1. Reduced tax rate regimes
  • 7.4.4. Tax base regimes
  • 7.4.4.1. Tax exemption regimes
  • 7.4.4.2. Tax-free reserve regimes
  • 7.4.4.3. Reduced tax base regimes
  • 7.4.4.3.1. Introduction
  • 7.4.4.3.2. The Hungarian Interest from affiliated companies regime
  • 7.4.4.3.3. The Dutch Group interest box regime
  • 7.4.4.3.4. The Hungarian Tax base for interest payments received from abroad regime
  • 7.5. Notional interest deduction regimes
  • 7.6. Intellectual property regimes
  • 7.6.1. Overview
  • 7.6.2. Front-end (cost-based) regimes
  • 7.6.3. Back-end (income-based) regimes
  • 7.7. Insurance company regimes
  • 7.8. Generic holding company regimes (participation exemptions)
  • 7.9. Group coordination regimes
  • 7.10. Special holding company regimes
  • 7.11. Intermediate group finance and licence company regimes
  • 7.12. Foreign finance branch regimes
  • 7.13. Informal capital regimes
  • 7.14. Hybrid financing regimes
  • 7.15. Free zone regimes
  • 7.16. Summary and conclusions
  • 7.16.1. Content of the pseudo-case law of the Group
  • 7.16.2. Effectiveness of the pseudo-case law of the Group
  • 7.16.3. The Code is backed by the State aid prohibition and vice versa
  • Chapter 8 Discussion and Assessment of the Pseudo-Legislation of the Code of Conduct Group
  • 8.1. Introduction
  • 8.2. Exchange of information on tax rulings
  • 8.3. Common tax ruling policy
  • 8.4. EU-inbound profit transfers (the "gatekeeper problem").
  • 8.5. EU-outbound payments (the "reverse gatekeeper problem")
  • 8.6. Hybrid mismatches
  • 8.6.1. Introduction
  • 8.6.2. Hybrid financing mismatches
  • 8.6.3. Hybrid entities and hybrid PE mismatches
  • 8.7. Transfer pricing
  • 8.8. Summary and conclusions
  • Chapter 9 The Market Distortion Provisions and Harmful Tax Competition
  • 9.1. Introduction: The market distortion rules as an alternative or complement to the Code
  • 9.2. The notion of a market distortion in articles 116 and 117 of the TFEU
  • 9.2.1. Introduction
  • 9.2.2. "A difference" (disparity)
  • 9.2.3. "Distorting the conditions of competition"
  • 9.2.4. "Resultant distortion needs to be eliminated"
  • 9.2.5. Market-distorting fiscal disparities
  • 9.3. Market distortion procedure and enforcement
  • 9.3.1. Introduction
  • 9.3.2. Monitoring of existing distortions (rollback)
  • 9.3.3. Notification of new distortions (standstill)
  • 9.3.4. No direct effect
  • 9.4. Practical effect of the market distortion rules in tax and non-tax cases
  • 9.4.1. Introduction
  • 9.4.2. The European Commission
  • 9.4.3. The European Parliament
  • 9.4.4. The judiciary
  • 9.5. Reasons for non-application of the market distortion rules in direct tax matters
  • 9.5.1. Introduction
  • 9.5.2. Legal issues
  • 9.5.2.1. Introduction: preference for and primacy of other market integrating legal mechanisms to tackle market distortions
  • 9.5.2.2. Harmful tax competition: the Code of Conduct for Business Taxation
  • 9.5.2.3. Harmonization of national laws necessary for the functioning of the internal market
  • 9.5.2.4. Free movement rights
  • 9.5.2.5. State aid prohibition
  • 9.5.2.6. Conclusions
  • 9.5.3. Procedural and organizational issues
  • 9.5.4. Conceptual issues
  • 9.5.5. Political unfeasibility
  • 9.6. Summary and conclusions.
  • Chapter 10 Summary, Conclusions and Outlook: Inside the EU Code of Conduct Group - 20 Years of Tackling Harmful Tax Competition.

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