In a recent judgment delivered on March 3, 2020 (cassation appeal 5448/2018), the Supreme Court ruled on the limits of the interpretation of tax treaties in light of later versions of model conventions (and their commentaries) published by the OECD.
Preparation of financial statements and corporate income tax, recommencement of time periods, remote trials, gradual return to workplaces, insolvency proceedings and compliance with criminal law
As we reported in our commentary dated April 11, 2020 (read here), in the current health crisis commercial lease agreements are being renegotiated due to force majeure.
Madrid City Council plenary meeting approved on May 29, 2020 an amendment to the local tax laws on real estate tax and the tax on economic activities, to provide new reductions to both.
Royal Decree-Law 19/2020 states that the three-month time period for preparing financial statements and other documents required by law will start to run from June 1, 2020, and reduces the time period for approving financial statements to two months running from the end of the time period for their preparation. In keeping with the new time periods for preparation and approval of the financial statements, it is allowed to file a second corporate income tax self-assessment until November 30, 2020. Additionally, amendments are introduced to the rules on tax deferrals for small and medium-sized companies and the self-employed along with a new stamp tax exemption; and a later date has been determined for publication of the list of delinquent tax payers.
Decree n°2-20-371, published in the Official Gazette on May 19th, has extended the public health emergency through June 10th.
On May 20, 2020, the Polish government adopted the fourth and final package of anti-crisis solutions known as "Shield 4.0".
New guarantee facility, extension of ERTE temporary layoff procedures, effects of the crisis on transfer pricing, return to judicial activity and ‘shields’ for businesses.
Despite the economic situation caused by the current health crisis, there is still talk of approval in the short term of the “Google tax” and “Tobin tax”; and some speculation has appeared over a potential corporate income tax and personal income tax hike or over a reform of inheritance and gift tax and wealth tax, to make these taxes uniform across autonomous communities. Lastly, we have also been hearing about a potential new “tax on large fortunes”.
The current international health emergency is having a huge impact in every area, including tax, and will foreseeably have lasting effects. Transfer pricing is not immune to this situation and its consequences are being felt in elements such as intra-group financing, how controlled transactions are carried out, priced and documented, or the advance pricing agreements concluded with the tax authorities.