The European Commission welcomes EU Member States' formal green light for new rules to better resolve tax disputes. The decision taken by EU finance ministers at the ECOFIN Council meeting in Luxembourg today will ensure that businesses and citizens can resolve disputes related to the interpretation of tax treaties more swiftly and effectively. It will also cover issues related to double taxation - a major obstacle for businesses, creating uncertainty, unnecessary costs and cash-flow problems.
Double taxation refers to cases where two or more countries claim the right to tax the same income or profits of a company or person. It can occur, for example, due to a mismatch in national rules or different interpretations of a bilateral tax treaty with regards transfer pricing arrangements.
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