2022/0154(CNS) | [ParlTrack]

Proposal for a directive
Article 8 – paragraph 2

2. ~~When drawing up the~~In its report, the European Commission shall ~~take into account the information communicated by Member States pursuant to Article 7.~~ in particular assess: a) the suitability of the provisions for small and medium-sized enterprises; b) whether the scope of this directive shall be extended to the entirety of a company's equity.

Amendment 103 #

Proposal for a directive
Article 8 – paragraph 3

3. The Commission shall publish the report on its website. The report shall be accompanied by a legislative proposal where appropriate.

Amendment 104 #

Proposal for a directive
Article 9

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article. 2. The power to adopt delegated acts referred to in Article 4(5) shall be conferred on the Commission for an indeterminate period of time from [OP insert the date of entry into force of this Directive]. 3. The delegation of power referred to in Article 4(5) may be revoked at any time by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force. 4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making. 5. As soon as it adopts a delegated act, the Commission shall notify it to the Council. 6. A delegated act adopted pursuant to Article 4(5) shall enter into force only if no objection has been expressed by the Council within a period of 2 months of notification of that act to the Council or if, before the expiry of that period, the Council has informed the Commission that it will not object. That period shall be extended by 2 months at the initiative of the Council.Article 9 deleted Exercise of Delegation

Amendment 105 #

Proposal for a directive
Article 10

~~Informing the European Parliament The European Parliament shall be informed of the adoption of~~Article 10 delegated ~~acts by the Commission, of any objection to them, and of the revocation of a delegation of powers by the Council.~~

Amendment 106 #

Proposal for a directive
Article 10 a (new)

Article 10 a Cost Assessment Before transposing this Directive in accordance with article 11, Member States shall make public an assessment of the foreseen costs of the measures and the resulting decrease in the effective tax rate for corporates. In case of an expected decrease in the effective tax rate of more than 5%, the Member State shall accompany the transposition of this Directive with measures to maintain the effective tax rate at the existing level.

Amendment 107 #

Proposal for a directive
Article 11 – paragraph 2

2. Member States may defer the application of the provisions of this Directive to taxpayers that on [1 January 2024] benefit from an allowance on equity under national law for a period up to 10 years and in no case for a period longer than the duration of the benefit under national law.deleted

Amendment 108 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, René REPASI

Proposal for a directive
Article 11 – paragraph 2

Amendment 109 #

Proposal for a directive
Article 11 – paragraph 2

2. Member States may defer the application of the provisions of this Directive to taxpayers that on [1 January 2024] benefit from an allowance on equity under national law for a period up to 105 years and in no case for a period longer than the duration of the benefit under national law.

Amendment 15 #

Proposal for a directive
Title 1

Proposal for a COUNCIL DIRECTIVE on ~~laying down rules on a debt-equity bias reduction allowance and on~~ limiting the deductibility of interest for corporate income tax purposes

Amendment 16 #

Proposal for a directive
Recital 1

(1) Promoting a fair and sustainable business environment, including through targeted tax measures that incentivise investment and growth, is a high political priority of the Union. To support sustainable and long-term corporate financing, the tax system should minimise unintended distortions of business decisions, for example towards debt rather than equity financing. While the Commission’s Capital Markets Union 2020 Action Plan14 includes important actions to support such financing, for example Action 4 - Encouraging more long-term and equity financing from institutional investors, targeted tax measures should be adopted in order to enhance such actions. Such measures should take into account fiscal sustainability considerations. _________________ 14 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Capital Markets Union for people and businesses-new action plan’, COM(2020) 590 final (https://eur- lex.europa.eu/resource.html?uri=cellar:6 1042990-fe46-11ea-b44f- 01aa75ed71a1.0001.02/DOC_1&format= PDF)deleted

Amendment 17 #

Proposal for a directive
Recital 1

(1) Promoting a fair and sustainable business environment, including through targeted tax measures that incentivise investment and growth, is a high political priority of the Union. To support sustainable and long-term corporate financing, the tax system should reduce the tax burden to a maximum and to minimise unintended distortions of business decisions, for example towards debt rather than equity financing. While the Commission’s Capital Markets Union 2020 Action Plan14 includes important actions to support such financing, for example Action 4 - Encouraging more long-term and equity financing from institutional investors, targeted tax measures should be adopted in order to enhance such actions. Such measures should take into account fiscal sustainability considerations. _________________ 14 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Capital Markets Union for people and businesses-new action plan’, COM(2020) 590 final (https://eur- lex.europa.eu/resource.html?uri=cellar:610 42990-fe46-11ea-b44f- 01aa75ed71a1.0001.02/DOC_1&format=P DF)

Amendment 18 #

Proposal for a directive
Recital 1 a (new)

(1 a) The promotion of a competitive and resilient Capital Markets Union, having a strong equity market as one of its pillars, is essential for the promotion of jobs, economic growth and investment. This is particularly important in a context of foreseened economic downturn and after a succession of economic crisis that led many companies to rely on debt instruments. Private investment through equity is pivotal to tackle the economic challenges that lie ahead. Therefore, a legal instrument to harmonize the legislative solutions for the debt-equity bias, without prejudice to the legitimate and effective use of debt instruments, is necessary.

Amendment 19 #

Proposal for a directive
Recital 1 a (new)

(1 a) Whereas the burden of the promotion of capital markets should not be bared by governmental budget.

Amendment 20 #

Proposal for a directive
Recital 2

(2) Member States’ tax systems allow too leniently the taxpayers to deduct interest payments on debt financing, and thereby reduce the corporate income tax liability, while costs related to equity financing are non-tax deductible in most Member States. The asymmetric tax treatment of debt and equity financing across the Union induces a bias towards debt in investment decisions. Moreover, where Member States provide for a tax allowance on equity financing in their domestic law, such national measures differ significantly in terms of policy design. The asymmetric tax treatment of debt and equity financing across the Union exacerbated by too permissive interest limitation rules induce a bias towards debt in investment decisions.

Amendment 21 #

(2) Member States’ tax systems allow the taxpayers to deduct interest payments on debt financing, and thereby reduce the corporate income tax liability, while costs related to equity financing are non-tax deductible in most Member States. The asymmetric tax treatment of debt and equity financing across the Union induces a bias towards debt in investment decisions. Moreover, where Member States provide for a tax allowance on equity financing in their domestic law, such national measures differ significantly in terms of policy design. It is therefore essential to safeguard a level playing field for equity solutions and debt instruments, having in regard the need to guarantee minimum levels of systematic coherence between national tax frameworks, namely at the tax benefits level.

Amendment 22 #

Proposal for a directive
Recital 2

(2) Member States’ tax systems allow the taxpayers to deduct interest payments on debt financing, and thereby reduce the corporate income tax liability, while costs related to equity financing are non-tax deductible in most Member States. The asymmetric tax treatment of debt and equity financing across the Union induces a bias towards debt in investment decisions. Moreover, where Member States provide for a tax allowance on equity financing in their domestic law, such national measures differ significantly in terms of policy design. Due to the recent crises and debt problems in the single market there is an urgent need for this reform that puts equity and debt on equal footing and does not give an advantage to debt financing.

Amendment 23 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, Paul TANG, René REPASI

Proposal for a directive
Recital 2

(2) Member States’ tax systems allow the taxpayers to deduct interest payments on debt financing, and thereby reduce the corporate income tax liability, while costs related to equity financing are non-tax deductible in most Member States. The asymmetric tax treatment of debt and equity financing across the Union induces a bias towards debt in investment decisions. Moreover, where Member States provide for a tax allowance on equity financing in their domestic law, such national measures differ significantly in terms of policy design. By adopting this Directive, the Union answers the call by Parliament to address the tax-related debt-equity bias, including by reducing the interest deduction possibilities. 14a _________________ 14a Resolution of the European Parliament of 15 February 2022 on the impact of national tax reforms on the EU economy (2021/2074(INI)) (OJ C 342, 6.9.2022, p. 14).

Amendment 24 #

Proposal for a directive
Recital 3

(3) In order to remove possible tax related distortions among Member States, it is necessary to lay down a common framework of rules to address the tax related debt-equity bias across the Union in a coordinated manner. Such rules should ensure that ~~equity and~~ debt financing ~~are treated in a similar way for tax purposes across the single market. At the same time, a common Union legislative framework should be sustainable also~~ is disincentivized from a tax perspective bringing the ~~short term for Member States’ budgets. Such framework should therefore include rules, on the one hand, for the tax deductibility of~~treatment between debt and equity financing clos~~ts and, on the~~er to each other, for ~~limiting the tax deductibility of debt financing costs~~tax purposes across the single market.

Amendment 25 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, René REPASI, Paul TANG

Proposal for a directive
Recital 3

(3) In order to remove possible tax related distortions among Member States, it is necessary to lay down a common framework of rules to address the tax related debt-equity bias across the Union in a coordinated manner. Such rules should ensure that equity and debt financing are treated in a similar way for tax purposes across the single market. At the same time, athe tax deductibility of debt and/or the creation of an allowance on increases in equity has a negative impact on public revenues. A common Union legislative framework should be sustainable also in the short term for Member States’ budgets. Such framework should therefore include rules, on the one hand, for the tax deductibility of equity financing costs and, on the other, for limiting the tax deductibility of debt financing costs.

Amendment 26 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN

Proposal for a directive
Recital 3

(3) In order to remove possible tax related distortions among Member States, it is necessary to lay down a common framework of rules to address the tax related debt-equity bias across the Union in a coordinated manner, in full respect of the EU institutional framewok on tax matters established by the treaties. Such rules should ensure that equity and debt financing are treated in a similar way for tax purposes across the single market. At the same time, a common Union legislative framework should be sustainable also in the short term for Member States’ budgets. Such framework should therefore include rules, on the one hand, for the tax deductibility of equity financing costs and, on the other, for limiting the tax deductibility of debt financing costs.

Amendment 27 #

Proposal for a directive
Recital 3 a (new)

(3 a) In order to further develop the European Capital Markets Union, this proposal should aim at diversifying funding sources for European companies, with a particular focus on SMEs; therefore, it should avoid creating new costs and barriers to access financing for those companies that do not have easy access to capital markets; thus, limiting the deductability of their interest costs could hamper investment across Europe and should be limited.

Amendment 28 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN, Martin HLAVÁČEK, Ondřej KOVAŘÍK

Proposal for a directive
Recital 3 a (new)

(3 a) Whereas tax avoidance and evasion have a transformative nature and creating new tax benefits increase the risk of potential new forms of harmful tax practices; whereas additional corporate tax benefits decrease the revenues of Member States and pressure public services.

Amendment 29 #

Proposal for a directive
Recital 3 b (new)

(3 b) The Directive should take into account the challenges related to the sustainability of Member States’ public finances in the short term and therefore, avoid leading to substantial losses in Member States’ revenues.

Amendment 30 #

Proposal for a directive
Recital 4

(4) To ensure a simple and comprehensive legislative framework, the common framework of rules should apply to all undertakings in the Union that are subject to corporate income tax in a Member State. Financial undertakings have special features and require a specific treatment. If the rules to address the tax related debt-equity bias were to apply to them, the economic burden of the measures would be unequally distributed at the expense of non-financial undertakings. Financial undertakings should therefore be excluded from the scope of this Directive.

Amendment 31 #

Proposal for a directive
Recital 4

Amendment 32 #

Evelyn REGNER, Jonás FERNÁNDEZ, Aurore LALUCQ

Proposal for a directive
Recital 5

(5) To neutralise the bias against equity financing, an allowance should be envisaged so that increases in a taxpayer's equity from one tax period to the next are deductible from its taxable base, subject to certain conditions. The allowance should be calculated by multiplying the increase in equity with a notional interest rate based on risk-free interest rate as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC. Such risk-free interest rates are already part of EU law and have been practically and effectively applied as such. Any part of the allowance that cannot be deducted in a tax period due to insufficient taxable profits may be carried forward. Taking into account the specific challenges that small- and medium-sized enterprises (SMEs) face in accessing capital markets, an increased allowance on equity should be envisaged for taxpayers that are SMEs. In order for the deduction of an allowance on equity to be sustainable for public finances in the short term, it should be limited in time. To safeguard the system from abuses, it is necessary to exclude the tax value of a taxpayer's own shares as well as that of its participation in associated enterprises from the calculation of changes in equity. In the same vein, it is necessary to provide for the taxation of a decrease in a taxpayer’s equity from one tax period to the following one, to prevent an equity increase from being effected in an abusive manner. Such a rule would also encourage the retention of a level of equity. It would apply so that where there is a decrease in equity of a taxpayer that has benefitted from an allowance on equity increase, an amount calculated in the same way as the allowance would become taxable for 10 tax periods; unless the taxpayer provides evidence that this decrease is exclusively due to losses incurred during the tax period or due to a legal obligation.deleted

Amendment 33 #

Proposal for a directive
Recital 5

(5) To neutralise the bias against equity financing, an allowance should be envisaged so that increases in a taxpayer's equity from one tax period to the next are deductible from its taxable base, subject to certain conditions. The allowance should be calculated by multiplying half of the increase in equity with a notional interest rate based on risk-free interest rate as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC. Such risk-free interest rates are already part of EU law and have been practically and effectively applied as such. Any part of the allowance that cannot be deducted in a tax period due to insufficient taxable profits may be carried forward. Taking into account the specific challenges that small- and medium-sized enterprises (SMEs) and medium sized groups face in accessing capital markets, ~~an increased~~the allowance on equity ~~should be envisaged~~will only be accessible for taxpayers that are SMEs or medium sized groups, in order to compensate for the fact that their financing costs are higher, and the availability of capital is lower. In order for the deduction of an allowance on equity to be sustainable for public finances in the short term, it should be limited in time. To safeguard the system from abuses, it is necessary to exclude the tax value of a taxpayer's own shares as well as that of its participation in associated enterprises from the calculation of changes in equity. In the same vein, it is necessary to provide for the taxation of a decrease in a taxpayer’s equity from one tax period to the following one, to prevent an equity increase from being effected in an abusive manner. Such a rule would also encourage the retention of a level of equity. It would apply so that where there is a decrease in equity of a taxpayer that has benefitted from an allowance on equity increase, an amount calculated in the same way as the allowance would become taxable for 10 tax periods; unless the taxpayer provides evidence that this decrease is exclusively due to losses incurred during the tax period or due to a legal obligation.

Amendment 34 #

Proposal for a directive
Recital 5

(5) To neutralise the bias against equity financing, an allowance should be envisaged so that increases in a taxpayer's equity from one tax period to the next are deductible from its taxable base, subject to certain conditions. The allowance should be calculated by multiplying half of the increase in equity with a notional interest rate based on risk-free interest rate as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC. Such risk-free interest rates are already part of EU law and have been practically and effectively applied as such. Any part of the allowance that cannot be deducted in a tax period due to insufficient taxable profits may be carried forward. Taking into account the specific challenges that small- and medium-sized enterprises (SMEs) face in accessing capital markets, an increased allowance on equity should be envisaged for taxpayers that are SMEs. In order for the deduction of an allowance on equity to be sustainable for public finances in the short term, it should be limited in time. To safeguard the system from abuses, it is necessary to exclude the tax value of a taxpayer's own shares as well as that of its participation in associated enterprises from the calculation of changes in equity. In the same vein, it is necessary to provide for the taxation of a decrease in a taxpayer’s equity from one tax period to the following one, to prevent an equity increase from being effected in an abusive manner. Such a rule would also encourage the retention of a level of equity. It would apply so that where there is a decrease in equity of a taxpayer that has benefitted from an allowance on equity increase, an amount calculated in the same way as the allowance would become taxable for 10 tax periods; unless the taxpayer provides evidence that this decrease is exclusively due to losses incurred during the tax period or due to a legal obligation.

Amendment 35 #

Proposal for a directive
Recital 5

(5) To neutralise the bias against equity financing, an allowance should be envisaged so that increases in a taxpayer's equity from one tax period to the next are deductible from its taxable base, subject to certain conditions. Once this right has been granted, it should become irrevocable. The allowance should be calculated by multiplying the increase in equity with a notional interest rate based on risk-free interest rate as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC. Such risk-free interest rates are already part of EU law and have been practically and effectively applied as such. Any part of the allowance that cannot be deducted in a tax period due to insufficient taxable profits may be carried forward. Taking into account the specific challenges that small- and medium-sized enterprises (SMEs) face in accessing capital markets, an increased allowance on equity should be envisaged for taxpayers that are SMEs. In order for the deduction of an allowance on equity to be sustainable for public finances in the short term, it should be limited in time. Their disadvantaged situation with smaller and more complicated financing possibilities and their exposure to longer loss periods leads to the need for longer tax deductibility periods than for larger companies. To safeguard the system from abuses, it is necessary to exclude the tax value of a taxpayer's own shares as well as that of its participation in associated enterprises from the calculation of changes in equity. In the same vein, it is necessary to provide for the taxation of a decrease in a taxpayer’s equity from one tax period to the following one, to prevent an equity increase from being effected in an abusive manner. Such a rule would also encourage the retention of a level of equity. It would apply so that where there is a decrease in equity of a taxpayer that has benefitted from an allowance on equity increase, an amount calculated in the same way as the allowance would become taxable for 10 tax periods; unless the taxpayer provides evidence that this decrease is exclusively due to losses incurred during the tax period or due to a legal obligation.

Amendment 36 #

Lídia PEREIRA

Proposal for a directive
Recital 5

(5) To neutralise the bias against equity financing, an allowance should be envisaged so that increases in a taxpayer's equity from one tax period to the next are deductible from its taxable base, subject to certain conditions. The allowance should be calculated by multiplying the increase in equity with a notional interest rate based on risk-free interest rate as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC. Such risk-free interest rates are already part of EU law and have been practically and effectively applied as such. Any part of the allowance that cannot be deducted in a tax period due to insufficient taxable profits may be carried forward. Taking into account the specific challenges that small- and medium-sized enterprises (SMEs) face in accessing capital markets, an increased allowance on equity should be envisaged for taxpayers that are SMEs. In order for the deduction of an allowance on equity to be sustainable for public finances in the short term, it should be properly and proportionately limited in time. To safeguard the system from abuses, it is necessary to exclude the tax value of a taxpayer's own shares as well as that of its participation in associated enterprises from the calculation of changes in equity. In the same vein, it is necessary to provide for the taxation of a decrease in a taxpayer’s equity from one tax period to the following one, to prevent an equity increase from being effected in an abusive manner. Such a rule would also encourage the retention of a level of equity. It would apply so that where there is a decrease in equity of a taxpayer that has benefitted from an allowance on equity increase, an amount calculated in the same way as the allowance would become taxable ~~for 10 tax periods~~; unless the taxpayer provides evidence that this decrease is exclusively due to losses incurred during the tax period or due to a legal obligation.

Amendment 37 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN, Martin HLAVÁČEK, Ondřej KOVAŘÍK

Proposal for a directive
Recital 6

(6) In order to avoid a misuse of the deduction of the allowance on equity, it is necessary to lay down specific anti-tax avoidance rules. Such rules should target, in particular, schemes put in place to circumvent the conditions on which an equity increase qualifies for an allowance under this Directive, for instance, through the intra-group transfer of participations in associated enterprises. Such rules should also target schemes put in place to claim an allowance in the absence of any equity increase at group level. For example, intra-group debt financing or contributions in cash could be used for these purposes. Specific anti-tax avoidance rules should also prevent schemes from being put in place to claim that an increase in equity, and the corresponding allowance, is higher than it actually is, for example, through an increase in loan financing receivables or overvaluation of assets. Moreover, the general anti-tax abuse rule in Article 6 of Council Directive (EU) 2016/116415 applies against abusive acts which are not covered by the specific anti-tax avoidance framework of this Directive. _________________ 15 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).deleted

Amendment 38 #

Proposal for a directive
Recital 6

(6) In order to avoid a misuse of the deduction of the allowance on equity, it is necessary to lay down specific anti-tax avoidance rules. Such rules should target, in particular, schemes put in place to circumvent the conditions on which an equity increase qualifies for an allowance under this Directive, for instance, through the intra-group transfer of participations in associated enterprises. Such rules should also target schemes put in place to claim an allowance in the absence of any equity increase at group level. For example, intra- group debt financing or contributions in cash could be used for these purposes. Specific anti-tax avoidance rules should also prevent schemes from being put in place to claim that an increase in equity, and the corresponding allowance, is higher than it actually is, for example, through an increase in loan financing receivables or overvaluation of assets. Moreover, the general anti-tax abuse rule in Article 6 of Council Directive (EU) 2016/116415 applies against abusive acts which are not covered by the specific anti-tax avoidance framework of this Directive. Member States should also make sure the measures taken in the framework of this Directive are compliant with the Code of Conduct Group on Business Taxation. _________________ 15 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).

Amendment 39 #

Proposal for a directive
Recital 7

(7) To effectively address the tax- related debt-equity bias in a manner sustainable for the Union’s public finances, an allowance for equity financing should be accompanied by a limitation on the deductibility of debt financing costs. An interest limitation rule should therefore limit the deductibility of exceeding borrowing costs and apply independently from the allowance. Given the different objectives between such a rule and the existing anti-tax avoidance rule on interest limitation of Article 4 of Directive (EU) 2016/1164, both rules should be maintained. Taxpayers should first calculate the deductibility of exceeding borrowing costs under this Directive and then under ATAD. In the event that the latter results in a lower amount of deductible exceeding borrowing costs, the taxpayer should deduct this lower amount and carry forward or back any difference between the two amounts in accordance with Article 4 of ATAD.deleted

Amendment 40 #

Proposal for a directive
Recital 7

(7) To effectively address the tax- related debt-equity bias in a manner beneficial, and not further harming the sustainableility for the Union’s public finances, ~~an allowance for equity financing should be accompanied by~~ a limitation on the deductibility of debt financing costs should be introduced. An interest limitation rule should therefore limit the deductibility of exceeding borrowing costs and apply independently from the allowance. Given the different objectives between such a rule and the existing anti-tax avoidance rule on interest limitation of Article 4 of Directive (EU) 2016/1164, both rules should be maintained. Taxpayers should first calculate the deductibility of exceeding borrowing costs under this Directive and then under ATAD. In the event that the latter results in a lower amount of deductible exceeding borrowing costs, the taxpayer should deduct this lower amount and carry forward or back any difference between the two amounts in accordance with Article 4 of ATAD.

Amendment 41 #

Evelyn REGNER, Aurore LALUCQ

Proposal for a directive
Recital 7

Amendment 42 #

Proposal for a directive
Recital 7

(7) To effectively address the tax- related debt-equity bias in a manner sustainable for the Union’s public finances, an allowance for equity financing should be accompanied by a limitation on the deductibility of debt financing costs for groups that are not medium- size groups and undertakings that are not SMEs. An interest limitation rule should therefore limit the deductibility of exceeding borrowing costs and apply independently from the allowance. Given the different objectives between such a rule and the existing anti-tax avoidance rule on interest limitation of Article 4 of Directive (EU) 2016/1164, both rules should be maintained. Taxpayers should first calculate the deductibility of exceeding borrowing costs under this Directive and then under ATAD. In the event that the latter results in a lower amount of deductible exceeding borrowing costs, the taxpayer should deduct this lower amount and carry forward or back any difference between the two amounts in accordance with Article 4 of ATAD.

Amendment 43 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN, Martin HLAVÁČEK, Ondřej KOVAŘÍK

Proposal for a directive
Recital 7

(7) To effectively address the tax- related debt-equity bias in a manner sustainable for the Union’s public finances, an allowance for equity financing should be accompanied by a limitation on the deductibility of debt financing costs, except for micro, small and medium-sized enterprises. An interest limitation rule should therefore limit the deductibility of exceeding borrowing costs and apply independently from the allowance. Given the different objectives between such a rule and the existing anti-tax avoidance rule on interest limitation of Article 4 of Directive (EU) 2016/1164, both rules should be maintained. Taxpayers should first calculate the deductibility of exceeding borrowing costs under this Directive and then under ATAD. In the event that the latter results in a lower amount of deductible exceeding borrowing costs, the taxpayer should deduct this lower amount and carry forward or back any difference between the two amounts in accordance with Article 4 of ATAD. This provision should be consistent with Directive 2016/1164 so that it does not hamper EU’s attractiveness to investors, or adds any complexity for companies.

Amendment 44 #

Proposal for a directive
Recital 7

(7) To effectively address the tax- related debt-equity bias in a manner sustainable for the Union’s public finances, an allowance for equity financing should be accompanied by a limitation on the deductibility of debt financing costs. An interest limitation rule should therefore limit the deductibility of exceeding borrowing costs and apply independently from the allowance, excluding from this to the SMEs and their loans, as they are more vulnerable. Given the different objectives between such a rule and the existing anti-tax avoidance rule on interest limitation of Article 4 of Directive (EU) 2016/1164, both rules should be maintained. Taxpayers should first calculate the deductibility of exceeding borrowing costs under this Directive and then under ATAD. In the event that the latter results in a lower amount of deductible exceeding borrowing costs, the taxpayer should deduct this lower amount and carry forward or back any difference between the two amounts in accordance with Article 4 of ATAD.

Amendment 45 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN

Proposal for a directive
Recital 9

(9) In order to evaluate the effectiveness of this Directive, the Commission should prepare and publish an evaluation report on the basis of the information provided by Member States and of other available data. In its report, the Commission should assess in particular the suitability and effectiveness of the provisions in this Directive for SMEs and whether to extend the regime to a company's entire equity rather than its incremental equity increase. The report should be accompanied by a legislative proposal where appropriate.

Amendment 46 #

Proposal for a directive
Recital 9

(9) In order to evaluate the effectiveness of this Directive, the Commission should prepare and publish an evaluation report on the basis of the information provided by Member States and of other available data. The Commission’s report should be published and, if appropriate, accompanied by a review with a view to increasing the effectiveness of this Directive and by a legislative proposal amending this Directive.

Amendment 47 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN

Proposal for a directive
Recital 9

(9) In order to evaluate the effectiveness of this Directive, the Commission should prepare and publish an evaluation report on the basis of the information provided by Member States and of other available data. The evaluation should include a section dedicated exclusively to SMEs and the impact on them. In the case of poor results, the Commission should present a proposal to remedy the problems identified.

Amendment 48 #

Proposal for a directive
Recital 9

(9) In order to evaluate the effectiveness of this Directive, as well as its impact on SMEs and on tax revenues in Member States, the Commission should prepare and publish an evaluation report on the basis of the information provided by Member States and of other available data.

Amendment 49 #

Proposal for a directive
Recital 10

(10) In order to enable the smooth and prompt amendment of certain non- essential elements of this Directive taking into account ongoing developments, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission, so that the latter can amend this Directive, to modify the level of the risk premium rate as an element for the calculation of the allowance on equity. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making16 . In particular, to ensure equal participation in the preparation of delegated acts, the Council should receive all documents at the same time as Member States' experts, and its experts should systematically be given access to meetings of Commission expert groups dealing with the preparation of delegated acts. _________________ 16 OJ L 123, 12.5.2016, p. 1.deleted

Amendment 50 #

Evelyn REGNER, Aurore LALUCQ

Proposal for a directive
Article 1 – paragraph 1

This Directive lays down rules on the ~~deduction, for corporate income tax purposes, of an allowance on increases in equity and on the~~ limitation of the tax deductibility of exceeding borrowing costs.

Amendment 51 #

Proposal for a directive
Article 1 – paragraph 1

This Directive lays down rules on the deduction, for corporate income tax purposes, of an allowance on increases in equity for SMEs and medium-size groups and on the limitation of the tax deductibility of exceeding borrowing costs large undertakings and large groups.

Amendment 52 #

~~[...]~~deleted

Amendment 53 #

Evelyn REGNER, Aurore LALUCQ, René REPASI

Proposal for a directive
Article 3

~~[...]~~deleted

Amendment 54 #

Proposal for a directive
Article 3 – paragraph 1 – point 5 a (new)

(5 a) ‘large undertaking’ means all undertakings which exceed the threshold for large undertakings, as laid down in Article 3(4) of Directive 2013/34/EU;

Amendment 55 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, René REPASI

Proposal for a directive
Article 3 – paragraph 1 – point 5 a (new)

(5 a) a 'large undertaking' means all undertakings which exceed the threshold for large undertakings, as laid down in in Article 3(4) of Directive 2013/34/EU;

Amendment 56 #

Proposal for a directive
Article 3 – paragraph 1 – point 5 b (new)

(5 b) ‘Medium-sized group’ means all groups which do not exceed the threshold for medium-sized groups, as laid down in Article 3(6) of Directive 2013/34/EU;

Amendment 57 #

Evelyn REGNER, Aurore LALUCQ, René REPASI

Proposal for a directive
Article 3 – paragraph 1 – point 5 b (new)

(5 b) a 'large group' means all groups which exceed the threshold for large groups, as laid down in in Article 3(7) of Directive 2013/34/EU;

Amendment 58 #

Proposal for a directive
Article 3 – paragraph 1 – point 5 c (new)

(5 c) ‘Large group’ means all groups which exceed the threshold for large groups, as laid down in Article 3(7) of Directive 2013/34/EU;

Amendment 59 #

Proposal for a directive
Chapter II – title

II ~~ALLOWANCE ON EQUITY AND~~ INTEREST DEDUCTIONS

Amendment 60 #

Proposal for a directive
Article 4

~~[...]~~deleted

Amendment 61 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 1

An allowance on equity shall be deductible, for 105 consecutive tax periods, from the taxable base of a taxpayer for corporate income tax purposes up to 3015% of the taxpayer's earnings before interest, tax, depreciation and amortisation (“EBITDA ”) or up to EUR 140 000, whichever amount is lower in the tax period.

Amendment 62 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, Paul TANG

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 1

An allowance on equity shall be deductible, for 105 consecutive tax periods, from the taxable base of a taxpayer ~~for corporate income tax purposes~~, who is a SME or a medium-sized group, for corporate income tax purposes. The sum of the allowance and the deduction for interest rates is deductible up to 30% of the taxpayer's earnings before interest, tax, depreciation and amortisation (“EBITDA ”).

Amendment 63 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 1

An allowance on equity shall be deductible, for 105 consecutive tax periods for large companies and 20 consecutive periods for SMEs, from the taxable base of a taxpayer for corporate income tax purposes up to 30% of the taxpayer's earnings before interest, tax, depreciation and amortisation (“EBITDA ”).

Amendment 64 #

Lídia PEREIRA

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 1

An allowance on equity shall be deductible, for 105 consecutive tax periods, from the taxable base of a taxpayer for corporate income tax purposes up to 30% of the taxpayer's earnings before interest, tax, depreciation and amortisation (“EBITDA ”).

Amendment 65 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 1

An allowance on equity shall be deductible, for 105 consecutive tax periods, from the taxable base of a taxpayer for corporate income tax purposes up to 350% of the taxpayer's earnings before interest, tax, depreciation and amortisation (“EBITDA ”).

Amendment 66 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, Paul TANG, René REPASI

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 2

If the deductible allowance on equity, in accordance with the first subparagraph, is higher than the taxpayer’s net taxable income in a tax period, Member States shall ensure that the taxpayer may carry forward, without time limitation, the excess of allowance on equity to the following periods.deleted

Amendment 67 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 2

If the deductible allowance on equity, in accordance with the first subparagraph, is higher than the taxpayer’s net taxable income in a tax period, Member States shall ensure that the taxpayer may carry forward, ~~without time limitation~~for a maximum of 2 tax periods, the excess of allowance on equity to the following periods.

Amendment 68 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, Paul TANG, René REPASI

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 3

~~Member States shall ensure that the taxpayers may carry forward, for a maximum of 5 tax periods, the part of the allowance on equity which exceeds 30% of EBITDA in a tax period.~~deleted

Amendment 69 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 3

~~Member States shall ensure that the taxpayers may carry forward, for a maximum of 5 tax periods, the part of the allowance on equity which exceeds 30% of EBITDA in a tax period.~~deleted

Amendment 70 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 3

Member States shall ensure that the taxpayers may carry forward, for a maximum of 10 tax periods for larger companies and a maximum of 15 tax periods for SMEs, the part of the allowance on equity which exceeds 30% of EBITDA in a tax period.

Amendment 71 #

Lídia PEREIRA

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 3

Member States shall ensure that the taxpayers may carry forward, for a maximum of 510 tax periods, the part of the allowance on equity which exceeds 30% of EBITDA in a tax period.

Amendment 72 #

Proposal for a directive
Article 4 – paragraph 1 – subparagraph 3

Member States shall ensure that the taxpayers may carry forward, for a maximum of 5 tax periods, the part of the allowance on equity which exceeds 350% of EBITDA in a tax period.

Amendment 73 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 1

Subject to Article 5, the base of the allowance on equity shall be calculated as the difference between the level of net equity at the end of the tax period and the level of net equity at the end of the previous tax period, in other words, the year-on-year increase in own funds.

Amendment 74 #

Evelyn REGNER, Jonás FERNÁNDEZ, Paul TANG, Aurore LALUCQ

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 2

The allowance on equity shall be equal to half of the base of the allowance multiplied by the 10-year risk-free interest rate for the relevant currency and increased by a risk premium of 1% or, where the taxpayer is an SME, a risk premium of 1.5%.

Amendment 75 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 2

Amendment 76 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 2

The allowance on equity shall be equal to the base of the allowance multiplied by the 10-year risk-free interest rate for the relevant currency ~~and increased by a risk premium of 1% or, where the taxpayer is an SME, a risk premium of 1.5%~~.

Amendment 77 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 2

The allowance on equity shall be equal to the base of the allowance multiplied by the 10-year risk-free interest rate for the relevant currency and increased by a risk premium of 1.5% or, where the taxpayer is an SME, a risk premium of 12.5%.

Amendment 78 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 2

The allowance on equity shall be equal to the base of the allowance multiplied by the 10-year risk-free interest rate for the relevant currency and increased by a risk premium of 1,5% or, where the taxpayer is an SME, a risk premium of ~~1.5~~2%.

Amendment 79 #

Proposal for a directive
Article 4 – paragraph 2 – subparagraph 3

For the purposes of the second subparagraph of this paragraph, the 10- year risk-free interest rate for the relevant currency shall be the risk-free interest rate with a maturity of 10 years for the relevant currency, as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC for the reference date of 31 December of the year preceding the relevant tax period.deleted

Amendment 80 #

Proposal for a directive
Article 4 – paragraph 3

3. If, after having obtained an allowance on equity, the base of the allowance on equity is negative in a tax period, an amount equal to the negative allowance on equity shall become taxable for 105 consecutive tax periods for large companies and 20 consecutive periods for SMEs, up to the overall increase of net equity for which such allowance has been obtained under this Directive, unless the taxpayer provides sufficient evidence that this is due to accounting losses incurred during the tax period or due to a legal obligation to reduce capital.

Amendment 81 #

Proposal for a directive
Article 4 – paragraph 3

3. If, after having obtained an allowance on equity, the base of the allowance on equity is negative in a tax period, an amount equal to the negative allowance on equity shall become taxable for 105 consecutive tax periods, up to the overall increase of net equity for which such allowance has been obtained under this Directive, unless the taxpayer provides sufficient evidence that this is due to accounting losses incurred during the tax period or due to a legal obligation to reduce capital.

Amendment 82 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, Paul TANG, René REPASI

Proposal for a directive
Article 4 – paragraph 3

3. If, after having obtained an allowance on equity, the base of the allowance on equity is negative in a tax period, an amount equal to the negative allowance on equity shall become taxable for 105 consecutive tax periods, up to the overall increase of net equity for which such allowance has been obtained under this Directive, unless the taxpayer provides sufficient evidence that this is due to accounting losses incurred during the tax period or due to a legal obligation to reduce capital.

Amendment 83 #

Proposal for a directive
Article 4 – paragraph 4

~~4. The Commission shall be empowered to adopt~~ delegated acts in accordance with Article 9 amending paragraph 2 of this Article by modifying the rate of the risk premium, where any of the following two conditions is met: (a) the 10-year risk-free interest rate as referred to in paragraph 2 of this Article varies by more than two percentage points with regard to at least three Union currencies compared to the tax period in which the most recent delegated act modifying the risk premium, or, where there is no such delegated act, this Directive started to apply; or (b) zero or negative growth of the gross domestic product of the EU area in at least two successive quarters; and (c) the relevant data, reports and statistics, including those provided by Member States, conclude that the EU average of the financing conditions of debt for taxpayers in scope of this directive has more than doubled or halved since the last determination of the risk premium established in paragraph 2. The percentage of increase or decrease of the risk premium shall take into account the changes in the financing conditions mentioned under point (c) of the first subparagraph other than changes in the risk-free interest rate for the EU as laid down in the implementing acts adopted pursuant to Article 77e(2) of Directive 2009/138/EC, and in any case shall not begreater than the percentage of increase or decrease of the financing conditions mentioned under point (c) of the first subparagraph.

Amendment 84 #

Proposal for a directive
Article 4 – paragraph 4 a (new)

4 a. The provisions of this Article shall not apply to large undertakings and large groups.

Amendment 85 #

Evelyn REGNER, Aurore LALUCQ, René REPASI, Jonás FERNÁNDEZ

Proposal for a directive
Article 5

1. Member States shall take appropriate measures to ensure that the base of the allowance on equity does not include the amount of any increase which is the result of: (a) granting loans between associated enterprises; (b) a transfer between associated enterprises of participations or of a business activity as a going concern; (c) a contribution in cash from a person resident for tax purposes in a jurisdiction that does not exchange information with the Member State in which the taxpayer seeks to deduct the allowance on equity. This paragraph shall not apply if the taxpayer provides sufficient evidence that the relevant transaction has been carried out for valid commercial reasons and does not lead to a double deduction of the defined allowance on equity. 2. Where an increase in equity is the result of a contribution in kind or investment in an asset, Member States shall take the appropriate measures to ensure that the value of the asset is taken into account for the calculation of the base of the allowance only where the asset is necessary for the performance of the taxpayer’s income-generating activity. If the asset consists of shares, it shall be taken into account at its book value. If the asset is other than shares, it shall be taken into account at its market value, unless a different value has been given by a certified external auditor. 3. Where an increase in equity is the result of a reorganisation of a group, such increase shall only be taken into account for the calculation of the base of the allowance on equity for the taxpayer in accordance with Article 4 to the extent that it does not result in converting into new equity the equity (or part thereof) that already existed in the group before the re- organisation.Article 5 deleted Anti-Abuse Rules

Amendment 86 #

Proposal for a directive
Article 5 – paragraph 3

3. Where an increase in equity is the result of a reorganisation of a medium- sized group, such increase shall only be taken into account for the calculation of the base of the allowance on equity for the taxpayer in accordance with Article 4 to the extent that it does not result in converting into new equity the equity (or part thereof) that already existed in the medium- sized group before the re- organisation.

Amendment 87 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN, Martin HLAVÁČEK, Ondřej KOVAŘÍK

Proposal for a directive
Article 5 – paragraph 3 a (new)

3 a. When implementing this Directive, Member States shall make sure the measures adopted are compliant with the guidance provided by the Code of Conduct Group (Business Taxation) on notional interest deduction regimes.

Amendment 88 #

Proposal for a directive
Article 6

1. Member States shall ensure that a taxpayer is able to deduct from its taxable base for corporate income tax purposes exceeding borrowing costs as defined in Article 1, point (2), of Council Directive (EU) 2016/116435 up to an amount (a) corresponding to 85% of such costs incurred during the tax period. If such amount is higher than the amount (b) determined in accordance with Article 4 of Directive (EU) 2016/1164, Member States shall ensure that the taxpayer be entitled to deduct only the lower of the two amounts in the tax period. The difference between the two amounts (a) and (b) shall be carried forward or back in accordance with Article 4 of Directive (EU) 2016/1164. 2. Paragraph 1 shall apply to exceeding borrowing costs incurred from [OP insert the date of entry into force of this Directive]. _________________ 35 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).Article 6 deleted Limitation to Interest Deduction

Amendment 89 #

Evelyn REGNER, Aurore LALUCQ

Proposal for a directive
Article 6 – paragraph 1

1. Member States shall ensure that a taxpayer is able to deduct from its taxable base for corporate income tax purposes exceeding borrowing costs as defined in Article 1, point (2), of Council Directive (EU) 2016/116435 up to an amount (a) corresponding to 850% of such costs incurred during the tax period. If such amount is higher than the amount (b) determined in accordance with Article 4 of Directive (EU) 2016/1164, Member States shall ensure that the taxpayer be entitled to deduct only the lower of the two amounts in the tax period. ~~The difference between the two amounts (a) and (b) shall be carried forward or back in accordance with Article 4 of Directive (EU) 2016/1164.~~ _________________ 35 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).

Amendment 90 #

Proposal for a directive
Article 6 – paragraph 1

1. Member States shall ensure that a taxpayer, who is a large undertaking or a large group, is able to deduct from its taxable base for corporate income tax purposes exceeding borrowing costs as defined in Article 1, point (2), of Council Directive (EU) 2016/116435 up to an amount (a) corresponding to 850% of such costs incurred during the tax period. If such amount is higher than the amount (b) determined in accordance with Article 4 of Directive (EU) 2016/1164, Member States shall ensure that the taxpayer be entitled to deduct only the lower of the two amounts in the tax period. The difference between the two amounts (a) and (b) shall be carried forward or back in accordance with Article 4 of Directive (EU) 2016/1164. _________________ 35 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).

Amendment 91 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN

Proposal for a directive
Article 6 – paragraph 1

1. Member States shall ensure that a taxpayer is able to deduct from its taxable base for corporate income tax purposes exceeding borrowing costs as defined in Article 1, point (2), of Council Directive (EU) 2016/116435 up to an amount (a) corresponding to 850% of such costs incurred during the tax period. If such amount is higher than the amount (b) determined in accordance with Article 4 of Directive (EU) 2016/1164, Member States shall ensure that the taxpayer be entitled to deduct only the lower of the two amounts in the tax period. The difference between the two amounts (a) and (b) shall be carried forward or back in accordance with Article 4 of Directive (EU) 2016/1164. _________________ 35 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).

Amendment 92 #

Proposal for a directive
Article 6 – paragraph 1

1. Member States shall ensure that a taxpayer, except for micro, small and medium-sized enterprises as defined in the Commission’s recommendation of 6 May 2003, is able to deduct from its taxable base for corporate income tax purposes exceeding borrowing costs as defined in Article 1, point (2), of Council Directive (EU) 2016/116435 up to an amount (a) corresponding to 85% of such costs incurred during the tax period. If such amount is higher than the amount (b) determined in accordance with Article 4 of Directive (EU) 2016/1164, Member States shall ensure that the taxpayer be entitled to deduct only the lower of the two amounts in the tax period. The difference between the two amounts (a) and (b) shall be carried forward or back in accordance with Article 4 of Directive (EU) 2016/1164. _________________ 35 Council Directive (EU) 2016/1164 of 12 July 2016 laying down rules against tax avoidance practices that directly affect the functioning of the internal market (OJ L 193, 19.7.2016, p. 1).

Amendment 93 #

Proposal for a directive
Article 7 – paragraph 1 – point a

~~(a) the number of taxpayers that have benefited from the allowance on equity in the tax period, also as a percentage of the total number of taxpayers falling within the scope of this Directive;~~deleted

Amendment 94 #

Evelyn REGNER, Aurore LALUCQ, Jonás FERNÁNDEZ, René REPASI

Proposal for a directive
Article 7 – paragraph 1 – point b

(b) the number of SMEs that have benefitted from the allowance in the tax period, including as a percentage of the total number of SMEs falling within the scope of this Directive and the number of SMEs that have benefitted from the allowance, which are part of large groups within the meaning of Article 3(7) of Directive 2013/34/EU;deleted

Amendment 95 #

(b) the number of SMEs and medium- size groups that have benefitted from the allowance in the tax period, including as a percentage of the total number of SMEs and medium-sized groups falling within the scope of this Directive and the number of SMEs that have benefitted from the allowance, which are part of large groups within the meaning of Article 3(7) of Directive 2013/34/EU;

Amendment 96 #

Proposal for a directive
Article 7 – paragraph 1 – point c

(c) the total amount of expenditure incurred or tax revenue lost due to the deduction of allowance on equity allocated to the allowance on equity as compared to the national gross domestic product of the Member State;deleted

Amendment 97 #

Gilles BOYER, Olivier CHASTEL, Stéphanie YON-COURTIN

Proposal for a directive
Article 7 – paragraph 1 – point f

~~(f) the number of taxpayers to which anti-abuse measures have been applied in the tax period pursuant to this Directive including the related tax consequences and sanctions applied;~~deleted

Amendment 98 #

Proposal for a directive
Article 8 – title

Reports and review

Amendment 99 #