Fiscal Years 2022 and 2023: temporary relief from limitations on foreign tax credit introduced in the U.S.

In 2022, the Internal Revenue Service (IRS) fundamentally changed the rules regarding credit for foreign taxes paid by U.S. companies, introducing strict requirements that limited the creditability in the United States of a range of foreign taxes (e.g., withholding taxes incurred at source on certain payment streams received by U.S. companies such as from Brazil).

Tax delegation law and the reform of the incentives system

The draft law AS 571 ("Delegation to the Government regarding the revision of the system of incentives for companies, as well as provisions for the simplification of the related procedures") proposes, among other objectives, an organic renewal of the system of incentives for companies, to improve its effectiveness both from the point of view of economic development and social cohesion.

Draft for a German Growth Opportunities Act published 

A draft law for a "Growth Opportunities Act" was sent to the German Industry Associations for consultation on 14 July 2023. In addition to a new law introducing an investment grant for certain investments aiming to achieve energy savings, various adjustments to national and international tax law provisions are proposed (as briefly summarized hereinafter and without any claim to comprehensiveness).

UAE Corporate Tax Reform: main topics for multinational company having a local presence in the UAE

On 9 December 2022 the United Arab Emirates (“UAE”) issued the Federal Decree-Law no. 47 of 2022 on the taxation of corporations and businesses (“CIT”), which is a form of direct tax levied on the net income or profit of corporations and other entities from their business. By introducing the CIT Law, the UAE aims to reaffirm its commitment to meeting international standards for tax transparency and preventing harmful tax practices. In order to provide more clarity on the application of the UAE CIT Law, FAQs have been published on the MoF (Ministry of Finance) website and several implementing Ministerial, and Cabinet Decisions were issued in the last few months.

MICAR regulations: published first drafts of technical standards

On July 12, 2023, the European Securities and Markets Authority (ESMA) launched the first public consultation under the so-called MICAR Regulation (Market in Crypto-Assets Regulation) i.e. Regulation (EU) 2023/1114 of the European Parliament and of the Council of May 31, 2023 on crypto-assets markets.

There is no permanent establishment for VAT purposes in case one company uses its subsidiary to produce goods in a Member State of the European Union

On June 29, 2023, in its judgment in Case C-232/22, Cabot Plastics Belgium SA, the Court of Justice of the European Union clarified that a taxable person who is the recipient of production services carried out by a subsidiary, which operates exclusively for the taxable person in question, does not have a fixed establishment in the EU Member State in which the subsidiary operates, unless it has the power to dispose of the human and technical means of the subsidiary as if they were its own.

Publication on the Official Journal of Law no. 85/2023 converting the Employment Decree so-called “Decreto Lavoro”

Edited by Francesca Tironi, Marzio Scaglioni, Leila Rguibi, Marco Bove and Lorenzo Vassalli On July 3rd, 2023, Law No. 85/2023 converting, with amendments, Law Decree No. 48 of May 4th, 2023, the so-called “Employment Decree”, was published in the Italian…