The Commission has welcomed the agreement by Member States on their general approach for far-reaching new rules to eliminate the most common corporate tax avoidance practices.
While some of the measures have been changed owing to issues around implementation in some Member States, the Commission remains convinced that fast agreement on this Directive was imperative if we want quick action to be taken. Since the Parliament has already issued its opinion, the new rules will now soon be formally adopted by the Council.
Once implemented, this legislation will put an end to the most common loopholes and aggressive tax planning schemes currently used by some large companies to avoid paying their fair share of tax. For example, all Member States will now have the power to tax profits being moved to low-tax countries where the company does not have any genuine economic activity (CFC rules). Previously untaxed gains on assets such as intellectual property which have been moved from the EU's territory can also be taxed (exit taxation rules), while countries have also been empowered to tackle tax avoidance schemes that are not covered by specific anti-avoidance rules (general anti-abuse rule).
During the negotiations, some amendments were made to the original proposal: such as the scope of the provision on interest limitations and its transposition.
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