Applying the Court of Justice of European Union decision in Groupe Steria, Advocate General Campos Sanchez-Bordona today gave his opinion on two aspects of Dutch tax law in joined cases, X BV, case C‑398/16; and X NV, case C‑399/16.
The Advocate General concluded that EU law is violated by Dutch legislation which provides that a parent company established in the Netherlands cannot deduct interest in respect of a loan associated with a capital contribution made to a subsidiary established in another Member State. The deduction could have been availed of if the subsidiary had been resident in the same State as the parent company.
The Advocate General further concluded that EU law does not preclude national legislation which provides that a parent company established in a Member State cannot deduct from its profits losses (capital losses) derived from fluctuations in the exchange rate, in connection with the value of its shares in a subsidiary established in another Member State, where the same legislation does not provide, symmetrically, for tax to be levied on gains (capital gains) derived from those fluctuations.
Be the first to comment