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Tax & Legal

Tax & Legal

ECJ: Decision on Spanish Goodwill Amortization


In several cases the European Court of Justice (ECJ) dismissed the appeals brought against the judgments of the General Court clarifying to some extent its complex case-law on the selectivity of tax measures, particularly in the case of measures of general application that constitute an aid scheme. The ECJ confirmed that a measure can still be selective even if the transaction benefitting from the measure is open to all undertakings. Continue reading

Supreme Tax Court discontinues proceedings with regard to the referral to the European Court of Justice on the State Aid character of tax privilege for public undertakings


The Supreme Tax Court had asked (decision of 13.03.2019 – I R 18/19) the European Court of Justice (ECJ) whether Article 107(1) Treaty on the Functioning of the European Union (TFEU) was to be interpreted as meaning that State Aid existed where, under the rules of a Member State, (permanent) losses – incurred by a company from an economic activity maintained without receiving sufficient remuneration to cover its costs – are in principle to be regarded as hidden dividend distributions and accordingly may not reduce the profit of the company, but, in the case of companies in which the majority of voting rights are held directly or indirectly by legal persons governed by public law, those legal consequences are not to be applied to permanent losses arising if such “public” corporations carry on the activities for reasons of transport, environmental, social, cultural, educational or health policy. Continue reading

Draft discussion document for the promotion of R&D


In a draft discussion document the Federal Ministry of Finance has revealed plans for an annual research and development (R&D) grant costing a total of € 1.25 billion per annum. The plans provides for an initial duration of four years, after which an evaluation will follow. The Finance Ministry is thus currently planning total subsidy to the value of € 5 billion. According to the draft, the federal and state governments should each pay half of this amount. Continue reading

Supreme Tax Court to refer question to European Court of Justice on whether the real estate transfer tax exemption on conversions constitutes illegal state aid.


On 30 May 2017 the Supreme Tax Court decided to refer to the European Court of Justice (ECJ) the question of whether the real estate transfer tax (RETT) exemption on conversions – in Section 6a Real Estate Transfer Tax Act –   constitutes illegal state aid. Continue reading

Exemption from loss cancellation on change of shareholders may constitute state aid


The ECJ has held that a Finnish exemption from a loss forfeiture provision on the change of shareholders would be state aid if the authorities may apply it with discretion and would require Commission approval if the details of the scheme have substantially changed since Finland’s accession in 1995. Continue reading