The European Parliament’s recent endorsement of legislation to fight corporate tax avoidance might be a hard sell to individual member states. Some in the legal community believe the hard sell is due to the uncertainty created by the far-reaching legislation for multinational businesses, along with fears that it would make Europe an unattractive place to invest.
Fenwick tax partner Larissa Neumann and other lawyers spoke with Law360 about the concerns arising from the legislation and whether the tax proposals are likely to get final approval from the European Council.
Neumann also commented on the general anti-abuse rule – a proposal intended to cover gaps in a country’s more specific rules against tax avoidance.
“There’s no formal guideline for how to operate,” she told Law360. “Abuse is what the tax authorities say it is. So, if there’s no rule, then it’s hard for companies to plan because they don’t know when the tax authorities are going to say it’s abuse and when they’re not.”
The full article is available through the Law360 website (subscription required).