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A recent ECJ ruling decides on the VAT treatment of services offered via an online platform. We present the focal aspects.

The defensive measures enshrined in the Tax Havens Defense Act (Steueroasen-Abwehrgesetz “StAbwG”) threaten to apply to Russia and the other jurisdictions newly added to the EU Blacklist as early as 1 January 2024.

The invasion of the Russian armed forces in the Ukraine on 24 February 2022 is having – as far as predictable at all – substantial short-term and long-term consequences on all areas of the economy. In December 2022, the Institute of Public Auditors in Germany (IDW) published a fourth update on the potential effects of the Ukraine war on the accounting of current financial statements.

On 12 July 2022, the federal Ministry of Finance (BMF) published a draft bill on DAC7. This was approved on 10 November by the Bundestag.

On 2 August 2022, the tax authorities published a circular on the application of tax deductions under 50a of the German Income Tax Act (Einkommensteuergesetz – EStG) for remuneration from software development services. The BMF circular concerns cases in which German businesses develop software using businesses that are resident abroad.

In a surprise move as part of the third relief package, the federal government decided to begin implementation of internationally agreed global minimum tax on the national level now. This once more increases the relevance for German businesses coming with the scope of Pillar Two to get themselves prepared.

Many questions still remain unanswered in regulating how global minimum tax is to be implemented. Our update on the current situation of Pillar Two and an assessment of further developments.

In May 2022, the European Commission presented a draft directive to equal out the tax treatment of equity and debt, which allows for the deduction of notional interest on equity on the one hand, and contains a further limitation on interest deduction on the other.

Even though the proposed changes to the German RETT treatment of share deals had seemed to be stopped by the end of 2019, they shall now be enacted shortly. The corresponding legislative process, including the approval by the Upper House of Parliament (“Bundesrat”) shall be completed by June 2021 at the latest. The new measures shall then to come into force on 1 July 2021.