Tag: Unconstitutional

Germany vs A... GmbH, March 2021, BUNDESVERFASSUNGSGERICHT, Case No 2 BvR 1161/19

Germany vs A… GmbH, March 2021, BUNDESVERFASSUNGSGERICHT, Case No 2 BvR 1161/19

A GmbH provided funding in the form of a clearing account to its Belgian subsidiary. The account was unsecured and carried an interest of 6% p.a. In 2005, A GmbH and the Belgian company agreed on a debt write-off which was deducted for tax purposes. The tax authorities issued an assessment where the write-off was denied as a tax deductible expense. According to the tax authorities, independent third parties would have agreed on some kind of security. The lack thereof was a violation of the arm’s length principle. A GmbH brought the assessment to court. The Federal Fiscal Court (I R 73/16) found the assessment of the tax authorities to be lawful. This decision was then appealed to the Constitutional Court by  A GmbH, alleging violation of the general principle of equality as well as a violation of its fundamental procedural right to the lawful judge. Decision of the Constitutional Court The Federal Constitutional Court decided in favour of A ... Continue to full case
Colombia vs. Taxpayer, November 2020, The Constitutional Court, Sentencia No. C-486/20

Colombia vs. Taxpayer, November 2020, The Constitutional Court, Sentencia No. C-486/20

A Colombian taxpayer had filed an unconstitutionality complaint against Article 70 (partial) of Law 1819 of 2016, “Whereby a structural tax reform is adopted, mechanisms for the fight against tax evasion and avoidance are strengthened, and other provisions are enacted.” The Constitutional Court ruled that the Colombian GAAR legislation was not unconstitutional. Click here for English translation Click here for other translation (1) Corte Constitucional - Sentencia C-480 del 19 de noviembre de 2020 ... Continue to full case
Peru vs Colegio de Abogados de La Libertad, September 2020, Constitutional Court, Case No 556/2020

Peru vs Colegio de Abogados de La Libertad, September 2020, Constitutional Court, Case No 556/2020

In February 2019, Colegio de Abogados de La Libertad (CALL) in Peru filed an appeal before the Constitutional Court claiming that tax debts of at least 9 billion soles (USD 2,5 billions) owed by 158 large companies could not be collected by the tax authorities (SUNAT) due to the statute of limitation in Legislative Decree 1421. By four votes against and one vote for, the Constitutional Court rejected the claim. NoCOMPANY/TAXPAYERSTATUTE OF LIMITATIONS INVOKEDSTATUTE OF LIMITATIONS NOT INVOKEDTOTAL 1COMPAÑIA DE MINAS BUENAVENTURA S.A.A.2.083.106.4842.083.106.484 2SCOTIABANK PERU SAA1.076.546.4201.076.546.420 3COMPAÑIA MINERA ANTAPACCAY S.A.2.961.028725.065.302728.026.330 4MINERA LAS BAMBAS S.A.698.986.212698.986.212 5SOCIEDAD MINERA CERRO VERDE S.A.A542.560.586542.560.586 6TELEFONICA DEL PERU SAA301.180.21257.714.287358.894.499 7LATAM AIRLINES PERU S.A.332.312.17118.782.845351.095.016 8CONSORCIO MINERO S.A. EN LIQUIDACION122.737.710171.965.780294.703.490 9EMPRESA MINERA LOS QUENUALES S.A.255.456.549255.456.549 10AMERICA MOVIL PERU S.A.C.246.510.566246.510.566 11ENEL GENERACION PERU S.A.A.236.223.504236.223.504 12VOLCAN COMPANIA MINERA S.A.A161.464.638161.464.638 13SUPERMERCADOS PERUANOS SOCIEDAD ANONIMA 'O ' S.P.S.A33.294.659104.866.817138.161.476 14UNIVERSIDAD PERUANA DE CIENCIAS APLICADAS S.A.C128.889.678128.889.678 15COMPANIA MINERA ANTAMINA S.A119.550.076119.550.076 16ELECTROCENTRO S.A.111.905.388111.905.388 17UNION ANDINA DE CEMENTOS S.A.A. - UNACEM S.A.A15.132.22692.121.037107.253.263 18UNIVERSIDAD INCA GARCILASO DE ... Continue to full case
Germany - Constitutionality of interest limitation provisions, October 2015, Supreme Tax Court decision I R 20/15

Germany – Constitutionality of interest limitation provisions, October 2015, Supreme Tax Court decision I R 20/15

The Supreme Tax Court has requested the Constitutional Court to rule on the conformity of the interest limitation with the constitutional requirement to tax like circumstances alike. The interest limitation disallows net interest expense in excess of 30% of EBITDA. However, the rule does not apply to companies with a total net annual interest cost of no more than €3 m or to those that are not part of a group. There are also a number of other exemptions, but the overall effect is to render the actual impact somewhat arbitrary. In particular, the asserted purpose of the rule – prevention of profit shifts abroad through deliberate under-capitalisation of the German operation – seemed somewhat illusory to the Supreme Tax Court in the light of the relatively high threshold and of the indiscriminate application to cases without foreign connotations. The court also pointed out that interest, as such, is a legitimate business expense and that the limitation rule can penalise ... Continue to full case
France vs. SOCIETE SOUTIRAN ET COMPAGNIE, March 2011, Supreme Tax Court, Case nr. 342099

France vs. SOCIETE SOUTIRAN ET COMPAGNIE, March 2011, Supreme Tax Court, Case nr. 342099

The French Supreme Tax Court has ruled on 2 March 2011 that the transfer pricing legislation is in conformity with the French Constitution. “The plea of SOCIÉTÉ SOUTIRAN ET COMPAGNIE, that the article 57 of code general of the taxes infringing the rights and freedoms guaranteed by the Constitution must be regarded as not serious” Click here for translation 20110302 Conseil d_+ëtat N-¦ 342099 ... Continue to full case
Belgium vs M. Ruythooren and M. Smets, November 2004, Court of first instance Antwerp, Case No 188/2004

Belgium vs M. Ruythooren and M. Smets, November 2004, Court of first instance Antwerp, Case No 188/2004

At issue in this case was whether Belgian arm’s length provision in article 344 infringed Article 170 of the Belgian constitution, according to which a tax in favor of the State may only be introduced by law. “Does Article 344(1) of the Income Tax Code 1992, in the version applicable to the assessment years 1996, 1997 and 1998, infringe Article 170 of the Constitution, in particular Article 1 of that article, which provides that a tax for the benefit of the State may be introduced only by a law, in that Article 344(1) gives the executive authority the task of determining the taxable circumstances or at least makes it possible to determine taxable circumstances either by means of a standard to be laid down by the State itself or by means of a blank form to be filled in?» The Decision of the Court In accordance with the principle of legality in tax matters, as set out in Article 170(1) ... Continue to full case