bluuebunny/crossref_metadata_2025_split huggingface dataset:
Shareholder Loans in Danish Tax Law  (Foreign) Shareholders Beware!
Authors: Jeppesen Inge Langhave , Terkilsen Lars Kjærgård 
Published: February 2022

Beware - a new Danish provision on shareholder loans means that it can become quite expensive for a shareholder to have a loan in his company - a so-called shareholder loan. The starting point is that shareholder loans are prohibited under the Danish Companies Act and must be repaid. Nevertheless, a survey by the Danish tax authorities shows that several companies extend loans to their shareholders. Consequently, the Danish Parliament has adopted section 16E of the Tax Assessment Act which deals with the regulation of shareholder loans in a tax context. The result of the regulation is that a shareholder loan will - with a few exceptions - be re-categorized either as salary or as a dividend paid to the shareholder. The re-categorization only takes place, if the shareholder is a natural person with decisive influence over the company pursuant to section 2 of the Tax Assessment Act. The regulation encompasses both resident and foreign shareholders as long as the decisive influence is present. Taxation of a shareholder loan is not tantamount to it being legal in a corporate law context. This means that the shareholder might end up in a situation where the loan is being taxed and furthermore the taxpayer has to repay the loan. This article explains the regulation and the way decisive influence has to be understood. An analysis of case law on the exceptions to the regulation is carried out and finally a few remarks on the tax consequences for the shareholder - being resident in Denmark or abroad - are explained.
Notes on the Conditions for a Corrective Financial Transaction Tax
Authors: Tavares Diogo Ferraz Lemos 
Published: February 2022

In the aftermath of the financial crisis of 2007-2008, a general belief has emerged that some practices and behaviours carried out by financial agents have led to risky, selfish and unreliable conduct within financial markets. Such a belief leads to a new discussion on the regulation of the financial sector, comprising possible governmental interventions through corrective taxes. This article aims to establish the premises and conditions which must be observed in the possible implementation of a Financial Transaction Tax (FTT) with corrective objectives. At this time, it seems to be extremely useful to set forth the fundamental legal basis for this kind of taxation, since the legitimacy or adequacy of all concrete cases and specific legal provisions will depend on such legal grounds. To reach such an aim, we: (i) address the justification and possible corrective objectives of the taxation on financial market; (ii) establish the basic elements of FTTs; (iii) analyse the reasoning for the implementation of a corrective FTT; and finally, (iv) examine some specific issues related to the effects of the mentioned corrective taxation, which must be addressed in order to ensure the efficiency of such a tax.
Free Movement of Capital: The European Union Anti-Tax Avoidance Package and Brexit
Authors: Dourado Ana Paula 
Published: February 2022

In this article, the meaning and scope of free movement of capital under Article 63 of the Treaty on the Functioning of the European Union is (re) assessed, taking Brexit as an example. The scenario assumed herein is that Brexit will be extreme. Within this scenario, the United Kingdom (UK) can be handled as the USA or Brazil, for example. In the bilateral relationship between the UK and the European Union (EU) Member States, there will be no legal obligations for the UK deriving from either primary or secondary law, whereas the EU Member States are still forbidden to restrict capital movements from and to the UK. The CFC Rule in the Anti Tax Avoidance Directive, the EU standard on exchange of information, EU Good Governance Clauses, and their application in the Brexit extreme scenario are also discussed.
Beneficial Ownership and Derivatives: Has the Swiss Federal Supreme Court Decision in the SMI Futures Case Put an End to Cash-Futures Arbitrage?
Authors: Weidmann Oktavia 
Published: February 2022

The Swiss Federal Supreme Court recently decided a second case dealing with the question of beneficial ownership of dividends. The dividends were economically passed on to third parties in transactions involving cross-border derivatives. In the SMI Futures Case, the court denied a Danish bank a refund of dividend withholding taxes under Article 10 of the Switzerland/Denmark Double Taxation Convention (1973) as it did not regard the Danish bank as the beneficial owner of the dividends. The Danish bank was the legal owner and physical holder of equity baskets comprising the twenty largest Swiss equities, which form the Swiss Market Index (SMI). The Danish bank was also the direct recipient of the dividends from these shares. The equity baskets were hedged with SMI futures. The Federal Supreme Court suggested that the Danish bank failed in its obligation to provide information and cooperate with the tax authorities. The resulting lack of information on the facts of the transactions could not be remedied. The court maintained that the Danish bank passed the dividends on by way of non-market standard purchase and disposal prices of the Swiss shares. It regarded the interposition of a broker acting as a principal in the share purchase and sale as an indicator of the circularity of the whole transaction. It further suggested that the Danish bank transferred all market risks in the transactions to its parent company and to third-party counterparty banks. The court concluded that there was an interdependence between obtaining the dividends and passing them on to the Swedish parent company and/or other counterparty banks. After a critical analysis of the case, the article illustrates various examples of cash-futures arbitrage transactions (equities versus futures) with slight economic differences between the various forms of cash-futures arbitrage but potentially different taxation results. Beneficial ownership of the dividends may only be attributed to the physical holder (and legal owner) of the shares and direct recipient of the dividends in those cash-futures arbitrage transactions which are traded anonymously on exchange. Based on the decision of the Swiss Federal Supreme Court, beneficial ownership could be denied to the legal owner and physical holder of the shares (and direct recipient of the dividends) in cases where transactions are executed either over-the-counter (OTC) or as OTC-style block crosses on exchange.
Trouble Always Comes in Threes: The Taricco Case Saga and the Italian Limitation Period in VAT Fraud
Authors: Scarcella Luisa , Grisostolo Francesco 
Published: February 2022

The European Court of Justice (ECJ) decision on the so-called Taricco case has been a source of significant debate among Italian scholars for the past year. The peculiarity of this case derives from the fact that more than one legal discipline is involved, ranging from tax law, criminal and procedural criminal law to constitutional law. The purpose of this article is therefore to examine the entire Taricco case by considering in turn the three different judicial phases which have characterized it. Beginning with the ECJ decision, it is then necessary to take into account how the Italian Supreme Court (Corte di Cassazione) has implemented in its case law the dispositions contained in the European decision. Finally, it is important to analyse the recent ordinance of the Italian Constitutional Court addressing again the ECJ and therefore opening new phases in the ongoing debate. Particular attention is given to the implications of this case on fundamental principles characterizing most of the European Member States and the role this decision might have in the adoption of the European Directive on the fight against fraud to the Union’s financial interests by means of criminal law that will replace Convention on the Protection of the European Communities’ Financial Interests (PFI) Convention.
Fairness: A Dire International Tax Standard with No Meaning?
Authors: Mosquera Valderrama Irma Johanna , Burgers I. J. J. 
Published: February 2022

In their discussions on corporate income tax systems the International Organizations (IOs) OECD, UN, IMF and World Bank, Supranational Organizations (SOs), Non-Governmental Organizations (NGOs), associations of practitioners and Governments often refer to the concept of fairness without proper definition of what in the context of their arguments is fairness and how the fairness can be achieved. The consequence is that fairness in taxation is a blurred concept. This article shows that fairness in taxation has an economical, juridical, philosophical and political perspective. Following the overview of these perspectives, this article calls for more research on global perceptions of fairness and for formulating an agenda for discussing this issue by IOs, SOs, NGOs and Governments.
A Global Framework for Capital Gains Taxes
Authors: Kemmeren Eric C.C.M. 
Published: February 2022

Globally, tax systems are continuously discussed. That is more than a good thing! Taxes are in the midst of society and should, therefore, also be discussed in and by societies. Tax research can contribute to these discussions. In a number of countries, such as New Zealand, the Netherlands and the United States, it is debated in society whether capital gains should be included in the income tax base and, if so, how this should be done. In this context, the author will discuss whether, as a matter of principle, taxation of capital gains should be part of a comprehensive tax system that taxes a comprehensive concept of real net income and, if so, what are the key issues in the design of capital gains tax regimes. Attention will be paid not only to general aspects, but also to some international aspects of capital gains taxes. This article will ultimately present a global framework for capital gains taxes based on the developed benchmark. In the author’s view, this framework should be taken into account globally when designing a capital gains tax regime. It will contribute to creating a level playing field and to enhancing horizontal and vertical equality and equity.
Codes of Conduct as a Means to Manage Ethical Tax Governance
Authors: Gribnau Hans , Baisalbayeva K. , van der Enden E. 
Published: February 2022

The tax practices of multinationals are in the eye of the storm. The public outcry reflects deep concerns about the moral integrity of the tax system. Taxes make society and freedom possible, and paying taxes is about sharing the financial burden involved in societal cooperation. The distribution of the tax burden is an expression of the values of distributive justice and solidarity. Tax laws translate the moral obligation to contribute to society into a set of legal obligations. Good tax governance should be ethical tax governance. Ethical and reputational tax risks should be carefully managed. Codes of conduct are important instruments to enhance moral corporate behaviour. They generate transparency, thereby enabling stakeholders to evaluate the ethical quality of a corporation’s strategy. Tax codes of conduct are aimed at providing guiding principles to businesses and tax administrations to increase trust in the tax system on the part of society. The element of trust comprises not only the fact that both parties remain within the boundaries of the law, but also that everyone plays fairly and acts in an ethically compliant manner. Thus, tax codes of conduct are a good starting point to operationalize a company’s commitment to ethical tax governance.
EU policy forum: Fighting VAT Fraud and Enhancing VAT Collection in a Digitalized Environment
Authors: Herbain Charlène A. 
Published: February 2022

The digital transformation of the economy is successfully exploited by fraudsters who develop ways to avoid paying value-added tax (VAT) and steal VAT revenues for their own gain. Means are available to not just counter such fraudsters, but at the same time facilitate VAT collection. This article investigates different kinds of VAT frauds and the collection challenges they pose, following which it evaluates a number of technology solutions for their capacity to improve the EU VAT system.
Revisiting the Fiscal and Social Security Status of Highly Mobile Workers in the Road and Railway Transportation: Quo Vadis?
Authors: Niesten Hannelore 
Published: February 2022

The increasing mobility due to globalization and the increasingly integrated nature of regional economies, for example in the European Union, provides an excellent opportunity to subject the fiscal and social security status of international highly mobile workers employed in the road and railway transportation to a critical evaluation. As far as the international taxing rights over cross-border employment income are concerned, most double tax treaties, based on Article 15 of the OECD Model Tax Convention, use ‘the actual physical place of employment’ as the main starting point. However, the criterion of the state where the employee is physically present is insufficiently attuned to the situation of highly mobile workers carrying out activities in the international road and railway transportation. Because of their mobility and the cross-border nature of their activities, highly mobile workers are exposed to complex interpretation and application problems. An excessive fragmentation of (the exercise of) the place of employment by multiple working states can increase the exposure to conflicting characterizations of facts, additionally on the basis of differences across domestic laws, thereby giving rise to a greater potential for unrelieved double taxation. Further inconveniences may arise from the fact that the obligations demanded by social security law are not always geographically aligned with those determining the place of employment for tax purposes. The special focus of the present contribution lies in a critical comprehensive, in-depth attitude and evaluation of the interpretation and application problems with regard to (1) the place of exercise of employment of international transportation workers, and (2) the affiliated (dis) coordination between the tax allocation rules (double tax treaties) and the social security law rules (Regulation (EC) No 883/2004). Suggestions are made for a minimization of the detected application and interpretation problems regarding the tax jurisdiction over employment income of international transportation workers and the provision for better coordination between fiscal and social security law.
Case law note: ECJ Confirms Function-Based Approach to the VAT Exemption of Transactions Concerning Payments and Transfers
Authors: Herbain Charlène A. 
Published: February 2022

On 25 July 2018, the Court of Justice of the European Union (ECJ or the Court) rendered its judgment in the DPAS1 case, in which it examined the concept of ‘transaction concerning payments or transfers’ and the VAT exemption applicable thereto. While VAT exemptions have existed since the inception of VAT in the Union3 and the scope of VAT exemptions – in particular, that applicable to transactions concerning payments or transfers – has been explored by the ECJ on many occasions,4 this referral shows that doubts linger. With the advent of the Revised Payment Services Directive,5 new service providers, especially financial technology (FinTech) businesses, operating outside the banking system render services connected to transfer and payment; and make this case a timely one. This case note identifies and reflects upon the criterion used by the Court to reject the classification as ‘transaction concerning payments or transfers’ within the meaning of the VAT exemption provided by the VAT Directive. It also highlights significant points (some which were ignored by the ECJ) and evaluates these findings, thereby calling into question the correctness of the conclusion reached by the ECJ.
Applying Modern, Disruptive Technologies to Improve the Effectiveness of Tax Treaty Dispute Resolution: Part 2
Authors: Turcan Laura , Govind Sriram , Dimitropoulou Christina 
Published: February 2022

In Part 1 of this article, the authors analysed the main drawbacks of the existing tax treaty dispute resolution process and considered the fundamental features of the main types of disruptive technology, keeping in mind how they could improve this process. In this part, the authors make some specific suggestions as to how the analysed technologies can be used to improve the mutual agreement procedure (MAP) and supplementary solutions. This will include the use of video conferencing to cut costs and speed up resolution (section 2); electronic filing and checking of the MAP request with respect to documentation requirements (section 3); automatic notification as regards the deadline before arbitration is triggered and automatic forwarding of the request and any supplementary information to the other competent authority(ies); automatic notification of the taxpayer of each material step taken in the resolution of the case (without providing access to secure data); communication and exchange of information between competent authorities via secure electronic means in real time; and information storage in secure shared-data platforms (i.e. controlled access) allowing access to competent authorities and even to the arbitral panel, where required (section 3); the use of data analytics to cluster cases by type, allowing for easier inventory management, and to generate risk profiles that could help in both the prevention of MAP cases and the speedier resolution thereof (section 4); the use of artificial intelligence to review past cases, thereby allowing easier assignment to case workers, depending on their schedule, and thus, easier and more timely solutions based on precedents (section 5); and the use of blockchain to validate transactions and information and to remove the need for trust, thus allowing for an easier and quicker resolution, especially in multilateral cases (section 6). Finally, the authors’ proposal posits that due to communication requirements, costs and security considerations, the implementation of technology solutions requires a global, coordinated approach, which should be spearheaded and managed by international organizations such as the OECD and the UN. The implementation could be completed in several stages and be subject to peer reviews.
Open versus Closed Competence to Tax: A Comparative Legal Study of Municipal Taxes in Belgium and the Netherlands
Authors: de Jonckheere Miguel 
Published: February 2022

This article describes and compares the possibilities under Belgian and Dutch law for taxation by local authorities. The most striking difference is that Belgian local authorities may decide on their own as to which taxes they wish to impose, save for interdictions imposed by law, whilst local authorities in the Netherlands can levy only those taxes allowed by national law. The main purpose of this study is to enquire if the differences in tax competence are as substantial as one might expect at first glance. More specifically, the authors compare the existence, meaning and scope of some general principles and principles of tax law which are considered to limit the municipal tax competence. The conclusion is that the scope of some principles and even their very existence seems to be affected to a considerable degree by the extent of the municipal tax autonomy. The Belgian open tax system has been widely constrained by general principles of tax law, that are absent or have less far reaching consequences in the closed tax system existing in the Netherlands. Further research is needed to determine whether the authors’ findings can be extrapolated to other Member States who are operating systems of open or closed tax competence.
The PPT: The Introduction of a Uniform Standard with an Uncertain Application
Authors: Taramountas Konstantinos 
Published: February 2022

This essay focuses on the new proposed treaty-GAAR, Principal Purpose Test (PPT), and analyses its potential impact on conduit arrangements from an international perspective. Firstly, it traces the problem of treaty shopping that occurred back in the pre- Base erosion and profit shifting (BEPS) era and, secondly, argues that its increasingly complicated terminology and insufficient guidance to uniformly navigate tax authorities and courts afford opportunities for divergent applications that will undermine the reliance that has been placed on the double tax treaty (DTT) network. This incites concerns about the compatibility of the PPT with the principle of legal certainty which is enshrined in some national constitutions or under Article 1 of the First Protocol of the European Convention of Human rights (ECHR). In this context, the author contends that the signatories of the Multilateral Instrument (MLI) should introduce a number of procedural checks upon the application of the PPT via ‘the conference of the parties’. This should discourage taxpayers from entering into the widest possible range of conduit arrangements but ensure a sufficient degree of foreseeability in order for it to comply with the principle of legal certainty.
Policy Forum: Implicit Support and Its Implications on Guarantee Fee Pricing: Fact or Fiction
Authors: Dettmann Georg , Lambert Gary , Pletz Amanda 
Published: February 2022

In recent discussions as part of the Base Erosion and Profit Shifting (BEPS) initiative, the OECD has raised a number of questions regarding financial transactions relied upon in an intragroup context. These include questions on determining the shadow credit rating, implicit support, and data to be relied upon when evaluating the arm’s length nature of financial transactions. (OECD, Public Discussion Draft Financial Transactions, BEPS Actions 8–10, (3 July – 7 Sept. 2018), https://www.oecd.org/tax/transfer-pricing/BEPS-actions-8-10-transfer-pricingfinancial- transactions-discussion-draft-2018.pdf (accessed 29 July 2019).) More recently, comments by an OECD representative have asserted that a compromise between OECD members on the issue had been reached. (See comments made on 4 June 2019 by Tomas Balco (Head of the Transfer Pricing Unit, OECD Centre for Tax Policy and Administration) during the OECD International Tax Conference in Washington DC. See J. Martin, Agreement reached on OECD transfer pricing guidelines for financial transactions, official says, MNE Tax (8 June 2019), available at (accessed on 29 July 2019).) In this respect, the OECD acknowledges that Article 9 is relevant, but confirms that domestic law has priority, except to the extent that domestic provisions discriminate. This ongoing discussion demonstrates the complexity that tax payers and tax administrators face when considering financing arrangements. Although the focus of this article is on intra-group financial guarantees in a broad sense, it focuses attention on of implicit support, a concept potentially relevant to all intra-group financial transactions. This article will also consider some of the issues currently discussed in the context of intra-group financing, including the importance and impact of implicit support on financing arrangements, from the viewpoint of tax courts, the OECD, and financial market participants. It then considers approaches used to determine the extent, if any, of implicit support by the main credit rating agencies as well as other financial market participants, and it goes on to consider the pros and cons associated with different pricing methods to assess the arm’s length level of guarantees, once credit ratings adjusted for implicit support have been derived.