Amendments to the participation exemption regime, the tax consolidation regime, the net wealth tax rules and to the minimum tax rules are only a few of the numerous tax changes introduced. There are also changes to be introduced by tax treaties recently ratified by Luxembourg and their ratification status in other countries along with the dates of application. In 2016, with CRS becoming the new standard, Luxembourg is taking a big step in exchange of information in tax matters. This year, we will also see the birth of a new type of Luxembourg alternative investment fund called “reserved alternative investment fund” which will offer authorised AIFMs the opportunity to launch funds with the same benefits as specialised investment funds, but without prior supervisory approval, reducing “time to market”.
At EU level, the Directive on exchange of information on tax rulings has now been published and will have to be implemented by Luxembourg before the year-end. As far as BEPS is concerned, the European Union is demonstrating its willingness to act quickly, and released on 28 January a so-called anti-tax avoidance package, including a draft anti-BEPS directive, which aims to tackle many of the BEPS issues identified by the OECD (although this Directive will not specifically deal with VAT – it will have certain VAT ‘effects’. On VAT matters, a recent positive ECJ decision confirmed that the management of regulated real estate funds may benefit from a VAT exemption. The ECJ decision also provides some useful information to determine which types of management services which are covered/not covered by the VAT exemption.
Internationally, BEPS continues to dominate the international tax agenda with the recent signature by 31 countries, including Luxembourg, of a tax co-operation agreement to enable automatic sharing of country-by-country information.
Jeremie Schaeffer and Suzana Guzu Mercea
ATOZ Tax Advisers
Disclaimer: The information contained in the present page is general and does not constitute legal advice. Before taking any decision or action on the above information you should take the appropriate professional advice.