DESCRIPTION:
European legal act introducing rules to prevent tax avoidance by businesses and thus to address the issue of aggressive tax planning in the EU’s single market.
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| eira:ABB | eira:BindingInstrumentRequirement |
| dct:modified | 2023-07-26 |
| dct:spatial | EU |
| dct:identifier | http://data.europa.eu/eli/dir/2016/1164/oj |
| dct:title | Directive (EU) 2016/1164 preventing tax avoidance by companies |
| dct:description | Directive (EU) 2016/1164, also known as the Anti-Tax Avoidance Directive (ATAD), is a regulation established by the European Union to prevent aggressive tax planning, increase tax transparency, and create a level playing field for businesses across the EU. It provides measures to counteract some of the most prevalent tax avoidance practices of companies operating within the EU. |
| dct:publisher | EUR-Lex |
| dct:source | https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32016L1164 |
| skos:example | For instance, under the interest limitation rule, a company operating in the EU cannot excessively borrow to finance its operations and then deduct the interest payments from its taxable income to reduce its tax liability. Similarly, under the CFC rules, a parent company cannot shift its profits to a subsidiary in a low-tax country to avoid paying higher taxes in the country where it operates. |
| eira:concept | eira:SolutionBuildingBlock |
| skos:note | The directive provides five key areas for countering tax avoidance: interest limitation rules, exit taxation rules, a general anti-abuse rule, controlled foreign company (CFC) rules, and rules to tackle hybrid mismatches. It aims to ensure that companies pay tax where they make their profits. The directive applies to all taxpayers that are subject to corporate tax in one or more EU member states, including subsidiaries of companies based in third countries. |
| eira:view | LV-Binding Power and Jurisdiction |