48 Amendments of Isabel BENJUMEA BENJUMEA related to 2023/0321(CNS)
Amendment 82 #
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. 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, which discourages cross-border investments.
Amendment 88 #
Proposal for a directive
Recital 3 a (new)
Recital 3 a (new)
(3a) Harmonisation should not be understood as unification of Member States’ tax systems. Every Member State should be able to compete on tax. It is thus important to establish a range of tax rates that allows Member States to set their own tax rates to drive up competitiveness and attract investment in their countries.
Amendment 92 #
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, creating an even more competitive environment. 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 and encourage entrepreneurship in the single market, which is currently undermined by the bureaucratic burden and tax pressure. 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 to Member States’ budgets, including to invest in infrastructure, research and development and to deliver public services, 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 94 #
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 0001 billion 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.
Amendment 105 #
Proposal for a directive
Recital 9
Recital 9
(9) The objective of simplifying the current rules underscores the envisaged initiative, improving the efficiency and competitiveness of our single market. Therefore, the rules on the computation of the tax base should be built by applying a limited series of tax adjustments to the financial statements of each group member. These limited adjustments would represent common adjustments that are necessary to convert the financial accounting statements into a tax base. Considering the need for alignment with Directive (EU) 2022/2523, the adjustments should resonate with that framework, which should also facilitate implementation for Member States and businesses that would already be familiar with the general principles.
Amendment 106 #
Proposal for a directive
Recital 9 a (new)
Recital 9 a (new)
(9a) The ultimate aim of this Directive should be to simplify regulatory compliance in order to lessen the bureaucratic and tax burden companies face. This is an even bigger problem for European SMEs, which allocate more of their resources to meeting those obligations. What is more, the system should be voluntary so companies can decide whether or not to adopt it.
Amendment 120 #
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. That framework should be designed to be simple and intuitive for businesses and avoid being a new burden for them. 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 disputes.
Amendment 127 #
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 and financial services. 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 130 #
Proposal for a directive
Recital 14
Recital 14
(14) To provide space for growth and investment, Member States would also be allowed to individually apply additional post-allocation adjustments (e.g. tax treatment of pension contributions) in areas not covered by the common framework. Member States would also be free to further adjust their allocated share without a ceiling in order to ensure that Member States can make their national policy choices in this area. Most importantly, Directive (EU) 2022/2523 would effectively set a ceiling which would effectively ensure that the effective tax rate is at least 15%, as stipulated in the OECD framework. Member States should be allowed to set some legal ranges so they compete with each other on tax, thus generating resource efficiency, stimulating investment and creating jobs.
Amendment 133 #
Proposal for a directive
Recital 15
Recital 15
(15) Some Member States operate corporate tax systems which are built on principles that differ from the most common approach, such as distribution- based tax systems. It is therefore of prime importance to put in place the necessary adjustments, in order to ensure a workable interaction with those systems and not introduce a contradiction between the two systems which discourages business creation as a result of the bureaucratic burden it creates. The solution could be sought in certain post- allocation adjustments. These would entail that the part which would be allocated to a group member under a distribution-based system has to be modified in proportion to the distributions made during the fiscal year. The essence of a distribution-based tax system would be fully retained, considering that the distribution marks a timing point for taxing the allocated part and accordingly determine how much of this would need to be taxed. In this regard, it should be envisaged to operate a carry- forward mechanism, to ensure that the allocated part which is not taxed in the current year would be taxable in the following years.
Amendment 137 #
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, the possibility to compete on tax, audits and dispute settlement would have to remain primarily at the level of the Member States.
Amendment 141 #
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. Any changes to penalties should be disclosed to corporate groups in a timely and appropriate manner.
Amendment 143 #
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 750 000 0001 billion 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 150 #
Proposal for a directive
Recital 24
Recital 24
(24) To allow businesses to directly enjoy the benefits of the internal market without incurring an unnecessary additional administrative burden, information on the tax provisions set out in this Directive should be made accessible through the Single Digital Gateway (‘SDG’) in accordance with Regulation (EU) 2018/17248 . The SDG provides a one-stop-shop for cross-border users for the online provision of information, procedures and assistance services relevant to the functioning of the internal market. That one-stop-shop should be designed to reduce the burden on businesses, on the basis of the tax base to allow consolidated calculations, doing away with the need to file by country and in consolidated form. The good experience with the VAT one-stop-shop show how this one-stop-shop should be developed in order for it to operate properly. Businesses should be able to calculate a European tax base and should then file a return broken down by country. Each business will file a country- by-country breakdown only in a single Member State of its choice, thereby avoiding having to file one return per country and then a consolidated return. _________________ 8 Regulation (EU) 2018/1724 of the European Parliament and of the Council of 2 October 2018 establishing a single digital gateway to provide access to information, to procedures and to assistance and problem-solving services and amending Regulation (EU) No 1024/2012 (OJ L 295, 21.11.2018, p. 1).
Amendment 159 #
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 750 000 0001 billion or more in at least two of the last four fiscal years;
Amendment 162 #
Proposal for a directive
Article 2 – paragraph 1 a (new)
Article 2 – paragraph 1 a (new)
1a. Companies shall have the possibility to leave the BEFIT system, making it voluntary. The system shall be attractive enough for businesses to request it for the benefits it offers, not because it is imposed.
Amendment 167 #
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 750 000 0001 billion 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 750 000 0001 billion 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 170 #
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 750 000 0001 billion 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 750 000 0001 billion 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 173 #
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 750 000 0001 billion referred to in paragraph 1 shall be deemed to be met by each of the demerged groups where:
Amendment 176 #
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 750 000 0001 billion or more in that fiscal year;
Amendment 178 #
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 750 000 0001 billion or more in at least two of those fiscal years.
Amendment 180 #
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 750 000 0001 billion.
Amendment 197 #
Proposal for a directive
Article 8 – paragraph 1
Article 8 – paragraph 1
With the exception of financial assets held for trading, as referred to in Article 11(1), and investments made for the benefit of life insurance policyholders bearing the investment risk in the context of a unit- linked/index-linked life insurance policy, as referred to in Article 14, the financial accounting net income or loss of a BEFIT group member shall be adjusted to exclude 95% of the amount of dividends or other distributions received or accrued during the fiscal year, provided that at the date of distribution, the ownership interest is held by the BEFIT group member for more than one year and this interest carries right to more than 105% of the profits, capital, reserves or voting rights.
Amendment 200 #
Proposal for a directive
Article 9 – paragraph 1
Article 9 – paragraph 1
With the exception of financial assets held for trading, as referred to in Article 11(1), and investments made for the benefit of life insurance policyholders bearing the investment risk in the context of a unit- linked/index-linked life insurance policy, as referred to in Article 14, the financial accounting net income or loss of a BEFIT group member shall be adjusted to exclude 95% of the amount of gain or loss arising from the disposition of an ownership interest, provided that at the date of disposition, the ownership interest is held by the BEFIT group member for more than one year and this interest carries a right to more than 105% of the profits, capital, reserves or voting rights.
Amendment 201 #
Proposal for a directive
Article 10 – paragraph 1
Article 10 – paragraph 1
With the exception of financial assets held for trading, as referred to in Article 11(1), and investments made for the benefit of life insurance policyholders bearing the investment risk in the context of a unit- linked/index-linked life insurance policy, as referred to in Article 14, the financial accounting net income or loss of a BEFIT group member shall be adjusted to exclude the amount of gain or loss arising from changes in the fair value of an ownership interest, provided that at the date of disposition, the ownership interest is held by the BEFIT group member for more than one year and this interest carries right to more than 105% of the profits, capital, reserves or voting rights.
Amendment 203 #
Proposal for a directive
Article 11 a (new)
Article 11 a (new)
Article 11a If a financial asset is to be treated as being held for trading, solid demonstrable evidence must be provided. If there is no such evidence or there are any doubts, the financial asset shall not be treated as being held for trading.
Amendment 220 #
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 510 000.
Amendment 225 #
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: 2830 years;
Amendment 252 #
Proposal for a directive
Article 27 – paragraph 1 c (new)
Article 27 – paragraph 1 c (new)
(c) all intangible assets for which the useful life cannot be defined.
Amendment 257 #
Proposal for a directive
Article 41 – paragraph 1 – subparagraph 1
Article 41 – paragraph 1 – subparagraph 1
Notwithstanding Article 9, where, as a result of a disposition of shares, a BEFIT group member leaves the BEFIT group and during that or the previous fiscal year, this BEFIT group member acquired, in an intra- BEFIT group transaction, one or more fixed assets, anthe amount corresponding to the gain or loss arising from the intra- BEFIT group disposition of these fixed assets shall be included in the financial accounting net income or loss of the BEFIT group member which owned the assets prior to the intra-BEFIT group disposition.
Amendment 259 #
Proposal for a directive
Article 41 – paragraph 1 – subparagraph 2
Article 41 – paragraph 1 – subparagraph 2
The first subparagraph shall not apply if the BEFIT group member demonstrates that the intra-BEFIT group transaction was carried out for valid commercial reasons and within the parameters of the free market.
Amendment 307 #
Proposal for a directive
Article 45 – paragraph 5
Article 45 – paragraph 5
5. Notwithstanding Article 13(2), the exceeding borrowing costs as referred to in Article 2 of Council Directive (EU) 2016/1164 which arise from a transaction between BEFIT group members shall not be recognized for the purpose of computing the baseline allocation percentage of the BEFIT group member which incurs such costs. Member States shall take appropriate measures to encourage undertakings to reduce these risks.
Amendment 331 #
Proposal for a directive
Article 47 – title
Article 47 – title
Exception for shipping not covered by a tonnage tax regime, inland waterways transport and, air transport and financial services
Amendment 332 #
Proposal for a directive
Article 47 – paragraph 1 – subparagraph 1 – point c a (new)
Article 47 – paragraph 1 – subparagraph 1 – point c a (new)
(ca) financial services.
Amendment 346 #
Proposal for a directive
Article 56 – paragraph 1
Article 56 – paragraph 1
The filing entity may not be changed, unless it ceases when the group considers it appropriate, giving two meet the conditions as referred to in Article 3(10)onths’ notice to the competent authorities, and for well-founded reasons. A new filing entity shall then be designated by the group in accordance with the conditions of Article 3(10). If the group fails to designate a filing entity within two months after the previous filing entity ceased to meet the conditions or of its own accord, the BEFIT team as referred to in Article 60 shall then designate a filing entity for the BEFIT group.
Amendment 348 #
Proposal for a directive
Article 57 – paragraph 2
Article 57 – paragraph 2
2. The BEFIT information return shall be submitted to the filing authority no later than foursix months after the end of the fiscal year.
Amendment 352 #
Proposal for a directive
Article 58 – paragraph 1
Article 58 – paragraph 1
1. The filing entity shall notify the filing authority of errors in the BEFIT information return within twohree months of the timely submission of such return.
Amendment 353 #
Proposal for a directive
Article 60 – paragraph 1
Article 60 – paragraph 1
1. A BEFIT team shall be convened within onthree months after filing the BEFIT information return, as referred to in Article 57, in order to perform the tasks set out in Article 61. In addition, the BEFIT team shall provide a framework for communication and consultation amongst the competent authorities of the Member States where members of the same BEFIT group are resident for tax purposes or situated in the form of a permanent establishment. When a member of a BEFIT team consults other members, it shall receive a response within a reasonable time.
Amendment 354 #
Proposal for a directive
Article 61 – paragraph 4
Article 61 – paragraph 4
4. If the BEFIT team is unable to achieve consensus pursuant to paragraph 2 within foursix months of the date when all information required under Article 57 was reported, such consensus shall be deemed to be achieved if the members of the BEFIT team give their consent, by the simple majority of the present members in accordance with paragraph 5, to the BEFIT information return at the end of the fifth month from the date when the information was reported. The filing authority to which the BEFIT information return has been submitted shall notify the BEFIT information return to the filing entity.
Amendment 356 #
Proposal for a directive
Article 62 – paragraph 1
Article 62 – paragraph 1
1. Each BEFIT group member shall file its individual tax return with the competent authority of the Member State in which that BEFIT group member is resident for tax purposes or situated in the form of a permanent establishmentThe group shall decide in which State to submit the consolidated return no later than threfive months after receipt of the notice from the filing authority pursuant to Article 61 (3), (4) or (5), or, in case of a domestic group, no later than eightten months from the end ofafter the fiscal year.
Amendment 357 #
Proposal for a directive
Article 62 – paragraph 1 a (new)
Article 62 – paragraph 1 a (new)
1a. To avoid increasing bureaucratic burden, groups should be excluded from submitting a declaration in each country and in turn a consolidated declaration. Returns shall be submitted via the one- stop shop, consolidating all group corporate taxes in a single tax return.
Amendment 358 #
Proposal for a directive
Article 63 – paragraph 1
Article 63 – paragraph 1
1. A BEFIT group member shall notify the competent authority of the Member State in which it is resident for tax purposes or situated in the form of a permanent establishment of errors in the individual tax return within twofour months of the timely submission of such return.
Amendment 360 #
Proposal for a directive
Article 66 – paragraph 1
Article 66 – paragraph 1
1. The filing entity may appeal against the content of the BEFIT information return, in accordance with Article 59, within twofour months after the return was issued or notified. The appeal shall be heard by an administrative body that, in accordance with the law of the Member State of the filing authority, is competent to hear appeals at first instance. The administrative appeal shall be governed by the law of the Member State of the filing authority. Where there is no such administrative body in the Member State of the filing authority, the BEFIT group member may lodge a judicial appeal directly.
Amendment 361 #
Proposal for a directive
Article 67 – paragraph 1
Article 67 – paragraph 1
1. A BEFIT group member may appeal against the content of the individual tax assesment made pursuant to Article 64 before the competent authority of the Member State where that BEFIT group member is resident for tax purposes or situated in the form of a permanent establishment within twofour months after the assessment was notified to it. The administrative appeal shall be heard by an administrative body that, in accordance with the law of the Member State of the BEFIT group member, is competent to hear appeals at first instance. The administrative appeal shall be governed by the law of the Member State in which the BEFIT group member is resident for tax purposes or situated in the form of a permanent establishment. Where there is no such administrative body in the Member State where the BEFIT group member is resident for tax purposes or situated in the form of a permanent establishment, the BEFIT group member may lodge a judicial appeal directly.
Amendment 362 #
Proposal for a directive
Article 68 – paragraph 1
Article 68 – paragraph 1
1. Where the decision pursuant to Article 66 has been confirmed or varied, the filing entity shall have the right to appeal directly to the courts of the Member State where it is resident for tax purposes or situated in the form of a permanent establishment within twofour months of the receipt of the decision of the administrative appeals body. A judicial appeal shall be governed by the law of the Member State where the filing entity is resident for tax purposes or situated in the form of a permanent establishment.
Amendment 364 #
Proposal for a directive
Article 69 – paragraph 1
Article 69 – paragraph 1
1. Where the decision pursuant to Article 67 has been confirmed or varied, a BEFIT group member shall have the right to appeal to the courts of the Member State where it is resident for tax purposes or situated in the form of a permanent establishment within twofour months after the decision of the administrative appeals body referred to in Article 67 was notified to it. The judicial appeal shall be governed by the law of the Member State in which the BEFIT group member is resident for tax purposes or situated in the form of a permanent establishment.
Amendment 365 #
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 a 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 States, with the administrative or judicial appeal taking precedence over those limits.
Amendment 368 #
Proposal for a directive
Article 72 – paragraph 1
Article 72 – paragraph 1
Member States shall lay down rules on penalties applicable to infringements of national provisions adopted pursuant to this Directive and shall take all necessary measures to ensure that they are implemented and enforced. Penalties and compliance measures provided for shall be effective, proportionate and dissuasive. Any changes to those penalties should be disclosed to groups operating in the Member States in a timely and appropriate manner.