2. Int'l Tax Update Significant Developments in the Global Tax System - Andrew Seidler

Common Corporate Tax Base
• A definition of digital permanent establishment:
• Revenues exceeding EUR 5m pa derived remotely from users in a members state,
• where at least 1,000 registered individual users per month visited the digital platform or
• at least 1,000 digital contracts have been concluded per month with customers or users
in a member state
• or the volume of digital content collected by the taxpayer in the year exceed10% of the
group’s overall stored content;
• Amendments to R&D tax incentives to limit the credit to 10% of the R&D staff costs, with a
maximum threshold of EUR 20m for such costs;
• Limits the deductibility of finance costs to 10% of EBITDA or EUR1m if higher;
• Limits the carry forward of losses to five years;
• Disallowance of expenses paid to beneficiaries located in a jurisdiction considered to be a tax
haven according to the EU list of non-cooperative jurisdictions for tax purposes;
• Amendments to the classification of CFCs;
• Amendments to double tax treaties so that the parties agree to ensure that tax is paid where
economic activities take place and add anti avoidance/anti tax-evasion clauses.
• Provides for an EU wide tax identification number.