Business in Europe: Framework for Income Taxation (BEFIT)

Amendments tabled for the plenary sitting on this text, in their own numbering series. This is a different set from the committee amendments tracked elsewhere on AmendEU, and is not counted in any of the site’s amendment totals.

1. Amendment 1Proposal for a directive · Recital 1
   Current text

   (1) Within the Union there is currently no common approach to the computation of the taxable base for businesses. Therefore, Union businesses are obliged to comply with a different corporate tax system in each Member State in which they operate.

   Amendment

   (1) Within the Union there is currently no common approach to the computation of the taxable base for businesses. Therefore, Union businesses are obliged to comply with a different corporate tax system in each Member State in which they operate. For example, in 2023, according to the 2024 Annual Report on Taxation, statutory corporate tax rates varied between Member States from 10 % to 31,5 % (and from 9 % to 29 %, taking into account the tax support schemes put in place by governments).

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2. Amendment 2Proposal for a directive · Recital 2
   Current text

   (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 hi…

   Amendment

   (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, and can lead to double taxation, tax avoidance and double non-taxation. According to the 2024 Annual Report on Taxation, revenue losses due to corporate profit shifting were estimated at 20 % of all corporate tax revenues collected in 2022 in the Union, which would amount to around EUR 100 billion in nominal value. Those phenomena have 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 ne…

   Excerpt — full text in the official PDF.
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3. Amendment 3Proposal for a directive · Recital 3
   Current text

   (3) Albeit different in their design, the fundamental features of corporate income tax systems are similar as they lay down rules aiming towards the same objective, i.e., to arrive at a taxable base for businesses. In this vein, it would be important for businesses which operate on the internal market that Member States introduce a common legal framework to harmonise the fundamental features of corporate income tax systems with a view to simplifying tax rules and ensuring a fair competition.

   Amendment

   (3) Albeit different in their design, the fundamental features of corporate income tax systems are similar as they lay down rules aiming towards the same objective, i.e., to arrive at a taxable base for businesses. In this vein, to support the proper functioning of the internal market, the corporate tax environment in the Union should be shaped according to the principle that companies pay their fair share of tax in the jurisdiction(s) where their profits are generated. Therefore, it would be important for businesses which operate on the internal market that Member States introduce a common legal framework to harmonise the fundamental features of corporate income tax systems with a view to s…

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4. Amendment 4Proposal for a directive · Recital 3 a (new)
   Amendment

   (3a) Harmonising the corporate tax base through a common set of rules improves transparency, thereby fostering a fairer and healthier tax environment within the Union, which is underpinned in particular by the entry into force of Directive (EU) 2022/2523 on a global minimum level of taxation, and contributes to strengthening the Union’s overall competitiveness as well as the Union's commitment to internationally agreed standards.

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5. Amendment 5Proposal for a directive · Recital 4 a (new)
   Amendment

   (4a) To ensure legal certainty and avoid excessive administrative burdens on multinational enterprise groups, this Directive should aim for coherence with international tax developments, in particular those pursued by the OECD/G20 Inclusive Framework, including Pillar One and Pillar Two, while also taking into account the positions adopted by key international partners and Member States, including decisions to uphold or exempt themselves from agreed commitments. The Union should in any case retain sufficient flexibility to determine its own allocation mechanism, where necessary, in order to reduce compliance burdens and mitigate the risk of double or multiple taxation.

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6. Amendment 6Proposal for a directive · Recital 4 b (new)
   Amendment

   (4b) The Commission and the Member States should ensure the coherence and alignment of this Directive with the OECD/G20 Model Rules and with Directive (EU) 2022/2523. Wherever possible, the Commission and Member States should interpret concepts in this Directive in light of the principles and rules set out in Directive (EU) 2022/2523.

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7. Amendment 7Proposal for a directive · Recital 5
   Current text

   (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. 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. 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…

   Amendment

   (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. 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 internal market. 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 taxation a…

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8. Amendment 8Proposal for a directive · Recital 7
   Current text

   (7) Although the threshold would be determined on the basis of the combined revenues of the group on a global basis, the remit of the provisions should be limited to members of the group operating on the internal market as Union law only applies within the Union and does not bind non-Member States. Only the Union sub-set of such a group should therefore be captured. This would include companies which are resident for tax purposes in a Member State and their permanent establishments operating in a Member State as well as the permanent establishments in the Union of third country companies of the same group. Considering that the concept of a permanent establishment is dealt with within bilater…

   Amendment

   (7) Although the threshold would be determined on the basis of the combined revenues of the group on a global basis, the remit of the provisions should be limited to members of the group operating on the internal market as Union law only applies within the Union and does not bind non-Member States. Only the Union sub-set of such a group should therefore be captured. This would include companies which are resident for tax purposes in a Member State and their permanent establishments, including any significant economic presence, operating in a Member State as well as the permanent establishments in the Union of third country companies of the same group.

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9. Amendment 9Proposal for a directive · Recital 7 a (new)
   Amendment

   (7a) The Union should lead and actively participate in international discussions on making international corporate taxation fit for the future, including by promoting a form of harmonisation of rules and an allocation of the taxable base for large multinationals.

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10. Amendment 10Proposal for a directive · Recital 8 a (new)
    Amendment

    (8a) This Directive should lay down rules extending the concept of a permanent establishment so as to include a significant economic presence through which a business is wholly or partly carried on. The underlying objective is to improve the resilience of the internal market as a whole in order to address the challenges of taxation of the digital economy. The increased importance of services, accelerated by the digitalisation of the economy, has led to recent proposals, as embedded in the OECD/G20 Pillar One proposal, to define significant economic presence as a taxable nexus based on a purely quantitative threshold of sales in any given country in order to capture all sectors and ensure sim…

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11. Amendment 11Proposal for a directive · Recital 8 b (new)
    Amendment

    (8b) In order to provide for a robust definition of a taxable nexus of a business in a Member State, irrespective of whether the business is digital, it is necessary that such a definition is based on the revenues from any sales, including from the supplied digital services. The definition included in this Directive is identical to the definition agreed upon in the framework of the OECD/G20 Pillar One proposal, in order to ensure coherence between this Directive and that international framework. The Union should lead by example in the international tax reform discourse, in order to provide certainty to taxpayers. Furthermore, in order to ensure consistency, the Commission may issue recommend…

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12. Amendment 12Proposal for a directive · Recital 9
    Current text

    (9) The objective of simplifying the current rules underscores the envisaged initiative. 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

    (9) The objective of simplifying the current rules underscores the envisaged initiative, improving the efficiency and competitiveness of the internal 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 w…

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13. Amendment 13Proposal for a directive · Recital 10
    Current text

    (10) Given that, with the aim to bring simplification, the financial accounts will be used as a starting point for computing the tax base of each group member, it is necessary to draft tax rules in such a way that they stay as close as possible to financial accounting. In the cases where this is possible, the financial accounting treatment of an asset or liability would not change for the purpose of taxation and consequently, no adjustments would be required. Accordingly, it is also necessary that in line with the rationale of taxation, other elements of the tax base be treated for tax purposes in a different way compared to how they are qualified under financial accounting.

    Amendment

    (10) Given that, with the aim to bring simplification, the financial accounts will be used as a starting point for computing the tax base of each group member, it is necessary to draft tax rules in such a way that they stay as close as possible to financial accounting. In the cases where this is possible, the financial accounting treatment of an asset or liability would not change for the purpose of taxation and consequently, no adjustments would be required. Accordingly, it is also necessary that in line with the rationale of taxation, other elements of the tax base be treated for tax purposes in a different way compared to how they are qualified under financial accounting. In order to ensu…

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14. Amendment 14Proposal for a directive · Recital 10 a (new)
    Amendment

    (10a) In order to achieve the objective of a simplified tax framework and in order for this Directive to adequately complement Council Directive (EU) .../...1a+, the rules laid down in this Directive on the deductibility of interest should align with the ones provided for in Directive (EU) .../...++, where applicable. _______________ 1a Council Directive (EU) .../... of ... on laying down rules on a debt-equity bias reduction allowance and on limiting the deductibility of interest for corporate income tax purposes (OJ L , ..., ELI: ...). + OJ: Please insert in the text the number of the Directive contained in document 2022/0154(CNS) and insert the number, name, date and OJ reference of that…

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15. Amendment 15Proposal for a directive · Recital 10 b (new)
    Amendment

    (10b) To guarantee a minimal level of taxation of royalties, a royalties limitation rule for BEFIT group members should be introduced in accordance with the Subject to Tax Rule1a as proposed by the OECD/G20 Inclusive Framework in Pillar Two. _________________ 1a OECD (2023). Tax Challenges Arising from the Digitalisation of the Economy – Subject to Tax Rule (Pillar Two): Inclusive Framework on BEPS, OECD/G20 Base Erosion and Profit Shifting Project, OECD Publishing, Paris, https://doi.org/10.1787/9afd6856-en.

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16. Amendment 16Proposal for a directive · Recital 10 c (new)
    Amendment

    (10c) A fairer taxation of passive income also requires robust Controlled Foreign Company (CFC) rules for BEFIT group members in order to make them more resilient against profit shifting.

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17. Amendment 17Proposal for a directive · Recital 11 a (new)
    Amendment

    (11a) In order to encourage investment, achieve a sustainable transition and enhance the Union's ability to prevent and respond to emerging threats and crises, Member States should adopt a targeted accelerated depreciation regime to incentivise companies to make the necessary investments to deliver on the twin transition and foster their resilience. That temporary regime should stimulate sustainable economic growth, create jobs, enhance the Union’s security, including in the digital and energy sectors, and foster innovation in sustainable technologies. To operationalise those incentives and ensure a uniform approach across the internal market, the Commission should be mandated to adopt imple…

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18. Amendment 18Proposal for a directive · Recital 12
    Current text

    (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. 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…

    Amendment

    (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. Such a framework should be simple for businesses and should avoid imposing any new burden on 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 a capped cross-border loss relief between BEFIT group members, and subsequently, the aggregated tax base would be allocated to group members based on a transition allocati…

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19. Amendment 19Proposal for a directive · Recital 14
    Current text

    (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%.

    Amendment

    (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, for example to generate resource efficiency, stimulate investment and create jobs. Such additional adjustments may include deductions, allowances, tax credits or other national corporate income tax measures, including those promoting research and development or other policy objec…

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20. Amendment 20Proposal for a directive · Recital 14 a (new)
    Amendment

    (14a) The Commission and the Member States should ensure the coherence and alignment of this Directive with the OECD/G20 Model Rules and with Directive (EU) 2022/2523, in particular as regards the calculation of the effective tax rate on a country-by-country basis, which could be undermined by the cross-border loss relief between BEFIT group members envisaged in this Directive. That dimension should be assessed in the revision of this Directive.

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21. Amendment 21Proposal for a directive · Recital 15
    Current text

    (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. 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…

    Amendment

    (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 to introduce a contradiction between the two systems, which would discourage business creation. 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 distributi…

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22. Amendment 22Proposal for a directive · Recital 17
    Current text

    (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, audits and dispute settlement would have to remain primarily at the level of…

    Amendment

    (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 confidentiality and security, as well as coordination and collaboration amongst national tax administrations. At the same time, during the transition, the administration system should fully respect national tax sovereignty as local tax returns, audits and di…

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23. Amendment 23Proposal for a directive · Recital 18
    Current text

    (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.

    Amendment

    (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. Those penalties should be set at a minimum rate of 0,1 % of the turnover of the BEFIT group in case of failure to file the BEFIT information return accordingly and in case of deliberate misreporting in a BEFIT information return.

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24. Amendment 24Proposal for a directive · Recital 18 a (new)
    Amendment

    (18a) A key pillar for improving corporate tax compliance is the establishment of a comprehensive one-stop-shop system that enables businesses to fulfil their tax obligations across Member States through a single, streamlined interface, thereby reducing administrative burdens, ensuring consistent enforcement, and enhancing legal certainty in the internal market.

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25. Amendment 25Proposal for a directive · Recital 19
    Current text

    (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 750 000 000 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

    (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 750 000 000 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. Companies choosing to be covered by this Directive should benefit from Member State and Commission technical assistance to comply…

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26. Amendment 26Proposal for a directive · Recital 21 a (new)
    Amendment

    (21a) To guarantee efficient cooperation among BEFIT teams, Member States should dedicate adequate human resources to the BEFIT team, including by providing content and language training to the BEFIT team representatives and by relying on the FISCALIS programme.

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27. Amendment 27Proposal for a directive · Recital 21 b (new)
    Amendment

    (21b) The Commission should, where appropriate, submit a legislative proposal for a harmonised, common European taxpayer identification number. This would not only facilitate the communication between the representatives of Member States and the BEFIT team, but also increase the efficiency of tax information exchange within the Union.

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28. Amendment 28Proposal for a directive · Recital 25 a (new)
    Amendment

    (25a) In line with the legally binding roadmap on new own resources set out in the Interinstitutional Agreement of 16 December 2020 and the 2021 Commission Communication "An adjusted package for the next generation of own resources", part of the revenues generated through the application of this Directive may be allocated to the general budget of the Union, in accordance with the applicable procedures under Council Decision (EU, Euratom) 2020/20531a. _______ 1a Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European Union and repealing Decision 2014/335/EU, Euratom (OJ L 424, 15.12.2020, p. 1; ELI: http://data.europa.eu/eli/dec/2020/2053/oj…

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29. Amendment 29Proposal for a directive · Article 1 – paragraph 2 – point e a (new)
    Amendment

    (ea) extending the concept of a permanent establishment, to include a significant economic presence through which a business is wholly or partly carried on.

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30. Amendment 30Proposal for a directive · Article 2 – paragraph 8
    Current text

    8. The Commission shall be empowered to adopt delegated acts in accordance with Article 74 to amend Annexes I and II to take account of changes to the laws of the Member States concerning company forms and corporate taxes.

    Amendment

    8. The Commission shall be empowered to adopt delegated acts in accordance with Article 74 to amend Annexes I and II strictly to reflect changes to the laws of the Member States concerning company forms and corporate taxes.

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31. Amendment 31Proposal for a directive · Article 3 a (new)
    Amendment

    Article 3a Significant economic presence 1. For the purposes of corporate tax, a permanent establishment shall be deemed to exist if a significant economic presence exists through which a business is wholly or partly carried on. 2. Paragraph 1 shall be in addition to, and shall not affect or limit the application of, any other test under Union or national law for determining the existence of a permanent establishment in a Member State for the purposes of corporate tax, whether specifically in relation to the supply of digital services or otherwise. 3. A significant economic presence shall be considered to exist in a Member State in a tax period if total revenues derived by a BEFIT group from…

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32. Amendment 32Proposal for a directive · Article 5 – paragraph 1 – point a
    Current text

    (a) the company is either the ultimate parent entity of the group or any other company of the group in which the ultimate parent entity holds, directly or indirectly, at least 75% of the ownership rights or of the rights giving entitlement to profit;

    Amendment

    (a) the company is either the ultimate parent entity of the group or any other company of the group in which the ultimate parent entity holds, directly or indirectly, at least 50% of the ownership rights or of the rights giving entitlement to profit;

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33. Amendment 33Proposal for a directive · Article 5 – paragraph 1 – point b
    Current text

    (b) the head office of the permanent establishment is either the ultimate parent entity of the group or any other member (company or entity) of the group in which the ultimate parent entity holds, directly or indirectly, at least 75% of the ownership rights or of the rights giving entitlement to profit.

    Amendment

    (b) the head office of the permanent establishment is either the ultimate parent entity of the group or any other member (company or entity) of the group in which the ultimate parent entity holds, directly or indirectly, at least 50% of the ownership rights or of the rights giving entitlement to profit.

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34. Amendment 34Proposal for a directive · Article 7 – paragraph 4 a (new)
    Amendment

    4a. Where it is not reasonably practicable to determine the financial accounting net income or loss of a constituent entity based on the acceptable financial accounting standard or authorised financial accounting standard used in the preparation of the consolidated financial statements of the ultimate parent entity, the financial accounting net income or loss of the constituent entity for the fiscal year may be determined using another acceptable financial accounting standard or an authorised financial accounting standard, provided that: (a) the financial accounts of the constituent entity are maintained on the basis of that accounting standard; (b) the information contained in the financial…

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35. Amendment 35Proposal for a directive · Article 13 a (new)
    Amendment

    Article 13a Royalties limitation rule The financial accounting net income or loss of a BEFIT group member shall be adjusted to include any amounts of royalty costs and licence fee payments for which the corresponding income derived by the recipient BEFIT group member is subject to an effective tax rate below 9%, unless the recipient entity carries out substantive economic activity supported by staff, equipment, assets and premises, as evidenced by relevant facts and circumstances.

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36. Amendment 36Proposal for a directive · Article 16 a (new)
    Amendment

    Article 16a Entertainment costs The financial accounting net income or loss of a BEFIT group member shall be adjusted to include 50% of the amount of expenses accrued for entertainment costs.

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37. Amendment 37Proposal for a directive · Article 20 – paragraph 1 – introductory part
    Current text

    The financial accounting net income or loss of a BEFIT group member shall be adjusted to exclude the following:

    Amendment

    The financial accounting net income or loss of a BEFIT group member shall be adjusted in accordance with Article 16(1), point (e), of Directive (EU) 2022/2523.

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38. Amendment 38Proposal for a directive · Article 20 – paragraph 1 – point a
    Current text

    (a) the amount of any unrealised foreign currency exchange gain or loss in relation to fixed assets and liabilities;

    Amendment

    deleted

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39. Amendment 39Proposal for a directive · Article 20 – paragraph 1 – point b
    Current text

    (b) the amount of any provision recorded for unrealised foreign currency exchange loss.

    Amendment

    deleted

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40. Amendment 40Proposal for a directive · Article 21 a (new)
    Amendment

    Article 21a Controlled foreign companies 1. The financial accounting net income or loss of a BEFIT group member shall be adjusted to include the non-distributed income of an entity or permanent establishment treated as a controlled foreign company as referred to in Article 7(1) of Directive (EU) 2016/1164, which is derived from the following categories: (i) interest or any other income generated by financial assets; (ii) royalties or any other income generated from intellectual property; (iii) dividends and income from the disposal of shares; (iv) income from financial leasing; (v) income from insurance, banking and other financial activities; (vi) income from invoicing companies that earn s…

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41. Amendment 41Proposal for a directive · Article 22 – paragraph 1
    Current text

    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 5000.

    Amendment

    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 7500.

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42. Amendment 42Proposal for a directive · Article 22 – paragraph 2 – point a
    Current text

    (a) all buildings as well as any other type of immovable property and structure in use for the business: 28 years;

    Amendment

    (a) all buildings as well as any other type of immovable property and structure in use for the business, with the exception of industrial buildings and structures: 30 years;

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43. Amendment 43Proposal for a directive · Article 22 – paragraph 2 – point a a (new)
    Amendment

    (aa) industrial buildings and structures: 25 years;

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44. Amendment 44Proposal for a directive · Article 22 – paragraph 2 – point b
    Current text

    (b) all other fixed tangible assets: their useful life as assessed in accordance with the acceptable accounting standard in the Union referred to in Article 7;

    Amendment

    (b) all other fixed tangible assets: their useful life as assessed in accordance with the acceptable accounting standard in the Union referred to in Article 7, but with a minimum of 10 years;

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45. Amendment 45Proposal for a directive · Article 22 a (new)
    Amendment

    Article 22a Accelerated depreciation rules 1. By way of derogation from Article 22, fixed tangible assets acquired by BEFIT group members in the following categories shall be subject to accelerated depreciation by Member States: a) assets that contribute directly to the Union’s climate and social goals, in particular the enhancement of clean technology, energy efficiency and digitalisation; b) assets that contribute directly to the attainment of the UN 2030 Sustainable Development Goals; c) assets that contribute directly to the enhancement of the Union's defence, notably its ability to prevent and respond to emerging threats and crises, in accordance with the Preparedness Union Strategy. 2.…

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46. Amendment 46Proposal for a directive · Article 23 – paragraph 5 a (new)
    Amendment

    5a. Member States shall not grant further entitlements to depreciate to a BEFIT group member other than those specified in this Section.

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47. Amendment 47Proposal for a directive · Article 25 – paragraph 1
    Current text

    1. Acquisition costs, construction costs or improvement costs, together with the date of entry into use after acquisition, construction or improvement, shall be recorded in a fixed asset register for each fixed asset separately.

    Amendment

    1. Acquisition costs, construction costs or improvement costs, together with the date of entry into use after acquisition, construction or improvement, shall be recorded in a fixed asset register within the BEFIT group for each fixed asset separately.

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48. Amendment 48Proposal for a directive · Article 25 – paragraph 3
    Current text

    3. The fixed asset register shall be kept in a manner that provides sufficient information, including depreciation data, to calculate the preliminary tax result and shall include at least the following information:

    Amendment

    3. The fixed asset register shall be kept in a manner that provides sufficient information, including depreciation data, to calculate the preliminary tax result. A copy of the fixed asset register shall be kept by the BEFIT group for 5 years from the date that the depreciation of such asset ceased. The fixed asset register shall include at least the following information:

    official amendment document ↗
49. Amendment 49Proposal for a directive · Article 38
    Current text

    Where a company or a permanent establishment enters a BEFIT group, any unrelieved losses incurred before the entry date, in accordance with the corporate tax law of the Member State of its tax residence or location respectively, shall be deducted from its share of the BEFIT tax base as determined in accordance with Chapter III.

    Amendment

    Where a company or a permanent establishment enters a BEFIT group, any unrelieved losses incurred up to five years before the entry date, in accordance with the corporate tax law of the Member State of its tax residence or location respectively, shall be deducted from its share of the BEFIT tax base as determined in accordance with Chapter III.

    official amendment document ↗
50. Amendment 50Proposal for a directive · Article 41 – paragraph 1 – subparagraph 1
    Current text

    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, an 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

    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, the 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.

    official amendment document ↗
51. Amendment 51Proposal for a directive · Article 41 – paragraph 1 – subparagraph 2
    Current text

    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.

    Amendment

    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 within the meaning of Article 15(1), point (a), of Directive 2009/133/EC.

    official amendment document ↗
52. Amendment 52Proposal for a directive · Article 42 – paragraph 2 – point b
    Current text

    (b) a negative amount, the loss shall be carried forward and shall be set off against the next positive BEFIT tax base.

    Amendment

    (b) a negative amount, the loss shall be set off against the taxable income of the ultimate parent entity and shall be carried forward for a maximum of 5 years and set off against the next positive BEFIT tax base. The deduction shall be in proportion to the holding of the ultimate parent entity in its qualifying subsidiaries as referred to in Article 3(1) and in full for permanent establishments. The reduction of the tax base of the resident taxpayer shall not result in a negative amount.

    official amendment document ↗
53. Amendment 53Proposal for a directive · Article 43 – paragraph 1 a (new)
    Amendment

    1a. The Commission shall provide clear and harmonised criteria for determining beneficial ownership. Those criteria shall aim to ensure the consistent application of the exemption system, reduce legal uncertainty, and prevent abuse. The criteria shall be developed in consultation with Member States and aligned, where appropriate, with international standards.

    official amendment document ↗
54. Amendment 54Proposal for a directive · Article 45 – paragraph 1 – subparagraph 1
    Current text

    For each fiscal year between 1 July 2028 and 30 June 2035 at the latest (the ‘transition period’), the BEFIT tax base shall be allocated to the BEFIT group members in accordance with the baseline allocation percentage.

    Amendment

    For each fiscal year between 1 July 2028 and 30 June 2033 at the latest (the ‘transition period’), the BEFIT tax base shall be allocated to the BEFIT group members in accordance with the baseline allocation percentage.

    official amendment document ↗
55. Amendment 55Proposal for a directive · Article 45 – paragraph 1 – subparagraph 2
    Current text

    For groups that become subject to this Directive after the end of the first fiscal year when this Directive starts to apply, the transition period referred to in the first subparagraph shall be terminated by 30 June 2035 at the latest.

    Amendment

    For groups that become subject to this Directive after the end of the first fiscal year when this Directive starts to apply, the transition period referred to in the first subparagraph shall be terminated by 30 June 2033 at the latest.

    official amendment document ↗
56. Amendment 56Proposal for a directive · Article 45 – paragraph 3 – point a
    Current text

    (a) low-risk zone: where the expense incurred, or the income earned, by a BEFIT group member from intra-BEFIT group transactions increase in a fiscal year by less than 10% compared to the average expense or income of the previous three fiscal years from intra-BEFIT group transactions;

    Amendment

    (a) low-risk zone: where the expense incurred, or the income earned, by a BEFIT group member from intra-BEFIT group transactions increase in a fiscal year by less than 15% compared to the average expense or income of the previous three fiscal years from intra-BEFIT group transactions;

    official amendment document ↗
57. Amendment 57Proposal for a directive · Article 45 – paragraph 3 – point b
    Current text

    (b) high-risk zone: where the expense incurred, or the income earned, by a BEFIT group member from intra-BEFIT group transactions increase in a fiscal year by 10% or more compared to the average expense or income of the previous three fiscal years from intra-BEFIT group transactions.

    Amendment

    (b) high-risk zone: where the expense incurred, or the income earned, by a BEFIT group member from intra-BEFIT group transactions increase in a fiscal year by 15% or more compared to the average expense or income of the previous three fiscal years from intra-BEFIT group transactions.

    official amendment document ↗
58. Amendment 58Proposal for a directive · Article 45 – paragraph 5
    Current text

    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.

    Amendment

    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 those risks.

    official amendment document ↗
59. Amendment 59Proposal for a directive · Article 45 – paragraph 9
    Current text

    9. The Commission shall carry out a comprehensive review of the transition rule as part of which it shall prepare a study on the possible composition and weight of selected formula factors and submit a report to the Council by the end of the third fiscal year during the transition period referred to in paragraph 1. If the Commission deems it appropriate, taking into account the conclusions of this report, it may adopt a legislative proposal during the transition period, to amend this Directive by introducing a method for the allocation of the BEFIT tax base using formulary apportionment and based on factors.

    Amendment

    deleted

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60. Amendment 60Proposal for a directive · Article 45 – paragraph 10
    Current text

    10. The rules laid down in paragraphs 1 to 8 shall continue to apply until any amendment thereof has come into effect.

    Amendment

    10. The rules laid down in paragraphs 1 to 8 shall continue to apply until the entry into force of any amendment proposed pursuant to Article 77(1b).

    official amendment document ↗
61. Amendment 61Proposal for a directive · Article 48 – paragraph 2
    Current text

    2. In addition to the adjustments listed in paragraph 1, a Member State may allow for increasing or decreasing, through additional items, the allocated part of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State.

    Amendment

    2. In addition to the adjustments listed in paragraph 1, a Member State may, subject to Directive (EU) 2022/2523, allow for increasing or decreasing, through additional items, the allocated part of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State.

    official amendment document ↗
62. Amendment 62Proposal for a directive · Article 48 – paragraph 2 a (new)
    Amendment

    2a. A Member State providing incentives for research and development shall refrain from offering output-based incentives, such as patent boxes, which would decrease the allocated part of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State.

    official amendment document ↗
63. Amendment 63Proposal for a directive · Article 48 – paragraph 2 b (new)
    Amendment

    2b. In order to prevent double taxation arising from the interaction between this Directive and bilateral tax treaties with third countries, Member States shall, where applicable, provide corresponding adjustments in accordance with their treaty obligations. The Commission may facilitate coordination and, where appropriate, issue guidelines to promote a consistent application across Member States.

    official amendment document ↗
64. Amendment 64Proposal for a directive · Article 57 – paragraph 2
    Current text

    2. The BEFIT information return shall be submitted to the filing authority no later than four months after the end of the fiscal year.

    Amendment

    2. The BEFIT information return shall be submitted to the filing authority no later than six months after the end of the fiscal year.

    official amendment document ↗
65. Amendment 65Proposal for a directive · Article 57 – paragraph 3 a (new)
    Amendment

    3a. For the purposes of paragraph 3, point (d)(ii), all supporting documentation that was used to build the BEFIT tax base referred to in that provision shall be kept for 10 years in order to be made available to the competent authorities of all Member States in which the BEFIT group members are resident for tax purposes or situated in the form of a permanent establishment.

    official amendment document ↗
66. Amendment 66Proposal for a directive · Article 57 – paragraph 4 a (new)
    Amendment

    4a. BEFIT teams shall use all existing procedures and arrangements offered by Directive 2011/16/EU1a to ensure an efficient cooperation and exchange of information between national tax administrations. __________ 1a Council Directive 2011/16/EU of 15 February 2011 on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC (OJ L 64, 11.3.2011, p. 1, ELI: http://data.europa.eu/eli/dir/2011/16/oj).

    official amendment document ↗
67. Amendment 67Proposal for a directive · Article 58 – paragraph 1
    Current text

    1. The filing entity shall notify the filing authority of errors in the BEFIT information return within two months of the timely submission of such return.

    Amendment

    1. The filing entity shall notify the filing authority of errors in the BEFIT information return within three months of the timely submission of such return.

    official amendment document ↗
68. Amendment 68Proposal for a directive · Article 60 – paragraph 2 a (new)
    Amendment

    2a. Member States shall attribute adequate human resources to the BEFIT team, including by providing content and language training to the BEFIT team representatives.

    official amendment document ↗
69. Amendment 69Proposal for a directive · Article 60 – paragraph 3
    Current text

    3. Information communicated between the members of a BEFIT team, shall be provided by electronic means to the extent possible, through making use of a BEFIT collaborative tool.

    Amendment

    3. Information communicated between the members of a BEFIT team, shall be provided by electronic means to the extent possible, via a secure connection or a secure network, through making use of a BEFIT collaborative tool.

    official amendment document ↗
70. Amendment 70Proposal for a directive · Article 60 – paragraph 4
    Current text

    4. To facilitate the operation and communication of the BEFIT team, the Commission shall, by means of implementing acts, standardise the communication of the information between the members of a BEFIT team through making use of a BEFIT collaborative tool. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 73.

    Amendment

    4. To facilitate the operation and communication of the BEFIT team, the Commission shall, by means of implementing acts, standardise the communication of the information between the members of a BEFIT team through making use of a BEFIT collaborative tool and support the secure transmission of information. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 73.

    official amendment document ↗
71. Amendment 71Proposal for a directive · Article 63 – paragraph 1
    Current text

    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 two months of the timely submission of such return.

    Amendment

    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 three months of the timely submission of such return.

    official amendment document ↗
72. Amendment 72Proposal for a directive · Article 65 – paragraph 1
    Current text

    1. The competent authority of a Member State may initiate and coordinate audits of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State.

    Amendment

    1. The competent authority of a Member State may initiate and coordinate audits of BEFIT group members that are resident for tax purposes or situated in the form of a permanent establishment in that Member State. That competent authority shall notify the other BEFIT team members within one month of the initiation of such an audit.

    official amendment document ↗
73. Amendment 73Proposal for a directive · Article 67 – paragraph 1
    Current text

    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 two 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 per…

    Amendment

    1. A BEFIT group member may appeal against the content of the individual tax assessment 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 3 months of the assessment being 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 perma…

    Excerpt — full text in the official PDF.
    official amendment document ↗
74. Amendment 74Proposal for a directive · Article 68 – paragraph 1
    Current text

    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 two 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

    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 3 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.

    official amendment document ↗
75. Amendment 75Proposal for a directive · Article 69 – paragraph 1
    Current text

    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 two 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

    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 3 months of the decision of the administrative appeals body referred to in Article 67 being 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.

    official amendment document ↗
76. Amendment 76Proposal for a directive · Article 70 – paragraph 1
    Current text

    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.

    Amendment

    Where the outcome of an administrative or judicial appeal requires amendments to the tax assessment of the BEFIT group or to the individual tax assessment of one or more members of a BEFIT group, Member States shall take the appropriate measures to ensure that such amendments remain possible, within a timeframe of 10 years.

    official amendment document ↗
77. Amendment 77Proposal for a directive · Article 72 – paragraph 1
    Current text

    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.

    Amendment

    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. Penalties shall be set at a minimum of 0,1 % of the turnover of the BEFIT group in the event of a failure to file the BEFIT information return in accordance with Article 59 and in the event of a deliberate misreporting in a BEFIT information return.

    official amendment document ↗
78. Amendment 78Proposal for a directive · Article 77 – paragraph 1 a (new)
    Amendment

    1a. As part of the evaluation of BEFIT referred to in paragraph 1, the Commission shall carry out a comprehensive review of the transition rule and develop a permanent method for the allocation of the BEFIT tax base. The development of the permanent method shall be preceded by a comprehensive impact assessment and appropriate stakeholder consultations, in accordance with the Commission’s Better Regulation principles.

    official amendment document ↗
79. Amendment 79Proposal for a directive · Article 77 – paragraph 1 b (new)
    Amendment

    1b. Before the end of the transition period, the Commission shall submit a legislative proposal to amend this Directive and introduce a permanent method for the allocation of the BEFIT tax base that replaces the transitional allocation formula. The permanent method for the allocation of the BEFIT tax base shall take into account the conclusions of the comprehensive impact assessment and shall incorporate the following four factors: sales, labour, assets and digital presence.

    official amendment document ↗
80. Amendment 80Proposal for a directive · Article 77 – paragraph 2
    Current text

    2. Member States shall communicate to the Commission relevant information for the evaluation of the Directive in accordance with paragraph 3, including aggregated data on BEFIT group members which are resident for tax purposes in their jurisdiction and permanent establishments thereof operating in their jurisdiction, in order to properly assess the impact of the transition allocation rule and of Directive (EU) 2022/2523 as well as assessing the situation regarding Pillar One of the Statement on a Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Economy agreed by the OECD/G20 Inclusive Framework on BEPS on 8 October 2021.

    Amendment

    2. Member States shall communicate to the European Parliament and to the Commission relevant information for the evaluation of the Directive in accordance with paragraph 3, including aggregated data on BEFIT group members which are resident for tax purposes in their jurisdiction and permanent establishments thereof operating in their jurisdiction, in order to properly assess: (i) the impact of the transition allocation rule; (ii) the link with other legislative acts in the area of corporate taxation, namely Directive (EU) 2022/2523 as well as the situation regarding Pillar One of the Statement on a Two-Pillar Solution to Address the Tax Challenges Arising from the Digitalisation of the Econo…

    Excerpt — full text in the official PDF.
    official amendment document ↗
81. Amendment 81Proposal for a directive · Article 77 – paragraph 4
    Current text

    4. Information communicated to the Commission under paragraph 2 shall be kept confidential by the Commission in accordance with the provisions applicable to Union institutions and Article 76 of this Directive.

    Amendment

    4. Information communicated to the European Parliament and to the Commission under paragraph 2 shall be kept confidential by the Commission in accordance with the provisions applicable to Union institutions and Article 76 of this Directive.

    official amendment document ↗
82. Amendment 82The LeftProposal for a directive · Recital 1 a (new)
    Amendment

    (1 a) In 1975, the Commission tabled a proposal to minimise the differences between Member States' corporate tax rates. Under the proposal, Member States could still choose their own corporate tax rate, but that rate could “not be lower than 45 % nor higher than 55 %”. Due to a lack of support from Member States, the proposal was withdrawn.

    official amendment document ↗
83. Amendment 83The LeftProposal for a directive · Recital 1 b (new)
    Amendment

    (1 b) In 2016, the Commission tabled an altered 'rebooted' proposal for a common corporate tax base (CCCTB). A common European corporate tax base would serve as a single rulebook on how companies should calculate their overall profit in the Union. After calculating a common tax base, a company active in more than one Member State could add up all the profits and losses of its entities in the different Member States to work out its total net profit or loss for the entire Union (consolidation). The company's taxable profits would then be allocated between the respective company entities, using an apportionment formula (formulary apportionment), with the profits being divided on the basis of th…

    Excerpt — full text in the official PDF.
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84. Amendment 84The LeftProposal for a directive · Recital 2
    Current text

    (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 hi…

    Amendment

    (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, especially because MNEs could use the different tax systems in order to engage in aggressive tax planning, resulting in SMEs having to pay a higher amount of taxes proportionally to their profits. 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 framew…

    Excerpt — full text in the official PDF.
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85. Amendment 85The LeftProposal for a directive · Recital 6
    Current text

    (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 750 000 000 based on t…

    Amendment

    (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 EUR 40 000 000 or more, in line with…

    Excerpt — full text in the official PDF.
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86. Amendment 86The LeftProposal for a directive · Recital 7 a (new)
    Amendment

    (7 a) The Union should actively engage in international negotiations with a view to promoting the global harmonisation of rules and the allocation of taxing rights based on a formula reflecting tangible factors such as labour, assets and sales. The ongoing negotiations within the United Nations on international tax cooperation are a unique and timely opportunity in that regard. In that context, the abstention of several Member States is regrettable and they should be strongly encouraged to participate constructively and proactively in those discussions.

    official amendment document ↗
87. Amendment 87The LeftProposal for a directive · Recital 7 b (new)
    Amendment

    (7 b) In order to avoid the delocalisation of profits outside the Union by MNEs, BEFIT groups should also declare their global profit at the international level. The formula used in this Directive would then also be used to compare the profits originally declared in the Union with the ones that would have been declared if the formula was applied to the global profits of the BEFIT group. If the corrected profits are higher than the declared profits, the Union will tax those corrected profits thanks to the formula included in this Directive.

    official amendment document ↗
88. Amendment 88The LeftProposal for a directive · Recital 7 c (new)
    Amendment

    (7 c) To fight against global tax avoidance, Member States could also unilaterally collect the tax deficit of multinationals: the difference between what a corporation pays in taxes globally and what it would have to pay if all of its profits were subject to a minimum tax rate in each of the countries in which it operates. Such a solution could encourage other countries to follow that move and progressively lead to an ambitious global solution.

    official amendment document ↗
89. Amendment 89The LeftProposal for a directive · Article 2 – paragraph 1 – point a
    Current text

    (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 750 000 000 or more in at least two of the last four fiscal years;

    Amendment

    (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 40 000 000 or more in at least two of the last four fiscal years;

    official amendment document ↗
90. Amendment 90The LeftProposal for a directive · Article 15 – paragraph 1
    Current text

    The financial accounting net income or loss of a BEFIT group member carrying out shipping activities shall be adjusted to exclude the amount of revenues, expenses and other deductible items derived from such activities covered by a tonnage tax regime.

    Amendment

    deleted

    official amendment document ↗
91. Amendment 91The LeftProposal for a directive · Article 42 – paragraph 2 – point b
    Current text

    (b) a negative amount, the loss shall be carried forward and shall be set off against the next positive BEFIT tax base.

    Amendment

    deleted

    official amendment document ↗
92. Amendment 92The LeftProposal for a directive · Article 45
    Current text

    [...]

    Amendment

    deleted

    official amendment document ↗
93. Amendment 93The LeftProposal for a directive · Article 45 a (new)
    Amendment

    Article45a Allocation rule based on tangible factors 1. As of 1 July 2027, the BEFIT tax base shall be allocated to the BEFIT group members in each tax year on the basis of the following formula, which gives equal weight to the factors of sales, labour and assets set out in Articles 45b to 45h: Share A = (SalesA / (3 * SalesGroup) + PayrollA / (6 * PayrollGroup) + Number of EmployeesA / (6 * Number of EmployeesGroup) + AssetsA/ (3* AssetsGroup) ) * Consolidated Tax Base 2. The consolidated tax base of a BEFIT group shall be shared only where it is a positive amount. 3. The calculations for sharing the consolidated tax base shall be done at the end of the tax year of the BEFIT group. 4. A per…

    Excerpt — full text in the official PDF.
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94. Amendment 94The LeftProposal for a directive · Article 45 b (new)
    Amendment

    Article45b Composition of the labour factor 1. The labour factor shall consist, as to one half, of the total amount of the payroll of a BEFIT group member as its numerator and the total amount of the payroll of the BEFIT group as its denominator, and as to the other half, of the number of employees of a BEFIT group member as its numerator and the number of employees of the BEFIT group as its denominator. Where an individual employee is included in the labour factor of a BEFIT group member, the payroll relating to that employee shall be allocated to the labour factor of the same BEFIT group member. 2. The number of employees shall be measured at the end of the tax year. 3. The definition of a…

    Excerpt — full text in the official PDF.
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95. Amendment 95The LeftProposal for a directive · Article 45 c (new)
    Amendment

    Article45c Allocation of employees and payroll 1. Employees shall be included in the labour factor of the BEFIT group member from which they receive remuneration. Employees with all types of contracts should be included. 2. By way of derogation from paragraph 1, where employees physically exercise their employment under the control and responsibility of an entity other than that from which they receive remuneration, those employees as well as the amount of payroll related to them shall be included in the labour factor of the former. That requirement shall only apply where all of the following conditions are met: (a) the employment lasts for an uninterrupted period of at least three months; (…

    Excerpt — full text in the official PDF.
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96. Amendment 96The LeftProposal for a directive · Article 45 d (new)
    Amendment

    Article45d Composition of the asset factor 1. The asset factor shall consist of the average value of all fixed tangible assets owned, rented or leased by a BEFIT group member as its numerator and the average value of all fixed tangible assets owned, rented or leased by the group as its denominator. 2. In the five years that follow a taxpayer joining an existing or new BEFIT group, its asset factor shall also include the total amount of costs incurred for research, development, marketing and advertising by the taxpayer over the six years that preceded its joining the BEFIT group.

    official amendment document ↗
97. Amendment 97The LeftProposal for a directive · Article 45 e (new)
    Amendment

    Article 45e Allocation of assets 1. Without prejudice to Article 22(2) and (3), an asset shall be included in the asset factor of its economic owner. Where the economic owner cannot be identified, the asset shall be included in the asset factor of the legal owner. However, an asset that is not effectively used by its economic owner shall be included in the factor of the BEFIT group member that effectively uses that asset, provided that the asset represents more than 5 % of the value for tax purposes of all fixed tangible assets of the BEFIT group member that effectively uses it. 2. Except in the case of leases between BEFIT group members, leased assets shall be included in the asset factor o…

    Excerpt — full text in the official PDF.
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98. Amendment 98The LeftProposal for a directive · Article 45 f (new)
    Amendment

    Article45f Valuation 1. Land and other non-depreciable fixed tangible assets shall be valued at their original cost. 2. An individually depreciable fixed tangible asset shall be valued at the average of its value for tax purposes at the beginning and at the end of a tax year. Where, as a result of one or more intra-group transactions, an individually depreciable fixed tangible asset is included in the asset factor of a BEFIT group member for less than one tax year, the value to be taken into account shall be calculated having regard to the number of months that the asset was included in the asset factor of that BEFIT group member. 3. The renter or lessee of an asset of which it is not the ec…

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99. Amendment 99The LeftProposal for a directive · Article 45 g (new)
    Amendment

    Article 45g Composition of the sales factor 1. The sales factor shall consist of the total sales allocated to a BEFIT group member as its numerator and the total sales of the BEFIT group as its denominator.

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100. Amendment 100The LeftProposal for a directive · Article 45 h (new)
     Amendment

     Article45h Sales by destination 1. Sales of goods shall be included in the sales factor of the BEFIT group member located in the Member State where the dispatch or transport of the goods to the person acquiring them ends. Where that place cannot be determined, the sale of goods shall be attributed to the BEFIT group member located in the Member State of the last identifiable location of the goods. 2. Supplies of services shall be included in the sales factor of the BEFIT group member located in the Member State where the services are physically carried out or actually supplied. 3. Where there is no BEFIT group member in the Member State where the goods are delivered or the services are suppl…

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101. Amendment 101The LeftProposal for a directive · Article 47
     Current text

     Article 47 Exception for shipping not covered by a tonnage tax regime, inland waterways transport and air transport 1. By way of derogation from Article 42 to 45 and without prejudice to Article 15, the revenues, expenses and other deductible items which stem from the following activities shall be excluded from the BEFIT tax base in any of the following cases: (a) the operation of ships in international traffic where the taxable result is not covered by a tonnage tax regime; (b) the operation of aircraft in international traffic; (c) the operation of boats engaged in inland waterways transport. The revenues, expenses and other deductible items as referred to in the first subparagraph shall b…

     Amendment

     deleted

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102. Amendment 102The LeftProposal for a directive · Article 72 – paragraph 1 a (new)
     Amendment

     Penalties shall be set at a minimum of 0,5 % of the turnover of the BEFIT group for any failure to file the BEFIT information return pursuant to Article 59.

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103. Amendment 103ESNProposal for a directive · Recital 3 a (new)
     Amendment

     (3 a) In accordance with the principles of subsidiarity and proportionality set out in Article 5 of the Treaty on European Union, direct taxation policy remains the responsibility of the Member States. This Directive shall in no way lead to binding harmonisation of national tax bases or affect the budgetary sovereignty of Member States.

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104. Amendment 104ESNProposal for a directive · Recital 18
     Current text

     (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.

     Amendment

     (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. Member States shall remain solely competent to define the system and level of penalties applicable, in accordance with their respective legal traditions.

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