In a recently published decision, the German Federal Fiscal Court (BFH) ruled that the German thin capitalisation regulations (interest barrier rule) may violate the principles of fair taxation as laid down in the German Constitution. Affected taxpayers should take all measures to keep their assessments open and to stay the execution of their tax assessment notice.
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While it’s great that the OECD is alive to multinationals’ fears of being caught in a compliance trap, the ‘common understanding’ illustrates a worrying lack of readiness
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