EU Commission Proposes A New Tax Framework

CORPORATE TAXPAYERS ARE EXPECTED TO BE SIGNIFICANTLY IMPACTED BY THE PROPOSED FRAMEWORK, IN PARTICULAR THE NEW FRAMEWORK FOR INCOME TAXATION FOR BUSINESSES IN EUROPE

On 18 May 2021, the EU Commission published a  Communication on Business Taxation for the 21st century (“the Communication”). The Communication sets out both a long-term and a short-term vision to support the EU's recovery from the COVID-19 pandemic, creates a fair and sustainable EU tax business environment, and takes account of the ongoing work on international corporate tax reform at OECD level.

Corporate taxpayers are expected to be significantly impacted by the proposed framework, in particular the new framework for income taxation for businesses in Europe (Business in Europe: Framework for Income Taxation, or “BEFIT”), which will create a common rulebook for groups of companies operating in the EU and replace the current Common Consolidated Corporate Tax Base (CCCTB) proposals.