GAAR as a tax treaty override -Slovak perspective (original) (raw)
Related papers
Gaar As Tax Treaty Override – Slovak Perspective
DANUBE: Law and Economics Review, 2017
The article summarises the views on the interrelation of GAARs and tax treaties, abstracts defining criteria for the feasibility of GAAR as an anti-abuse instrument in tax treaty situations and applies these to the situation (legislation and case law) in the Slovak Republic. The aim of the article is to provide insight on the potential interrelation of GAAR rules with existing tax treaties and formulate policy advice that should be optimal given the facts at hand. It shows that GAAR in its current form would in general have limited effectiveness in tackling tax treaty abuse situations without it resulting in treaty override. This particularly applies to the Slovak Republic and likely to other states applying a monistic approach to international treaties, where the renegotiation of the treaty seems the only viable option. However, as in Slovakia the monist approach applies only to treaties ratified after July 2001, a different approach might be taken with respect to those that are st...
Public Governance, Administration and Finances Law Review
This article aims towards an analysis of the Slovak Statutory General Anti-Abuse Rule (henceforth GAAR) which entered into force under the initiatives of the EU and OECD on 1 January 2014. The article provides an analysis of the particular construction elements of the implemented GAAR with respect to the European Court of Justice (henceforth ECJ) case law and GAAR legislative practice at EU level, which is seemingly, with regard to the Anti-Tax Avoidance Directive GAAR, unstoppable.
TAX TREATY OVERRIDE IN SLOVAKIA – DIGITAL PLATFORM PERMANENT ESTABLISHMENT
Bratislava Law Review, 2018
The article analyses the new " digital platform permanent establishment " concept as a legal fiction establishing a fixed place even in situations where there is no actual fixed place. The authors conclude that in the Slovak legal environment this concept is not capable of (i) being applied through the interpretation of the tax treaty, or (ii) overriding the tax treaty. Its practical implications in a tax treaty situation must be analysed on a case-by-case basis. The ineffectiveness of the concept mainly stems from the fact that Slovak statutory rules are generally incapable of overriding tax treaties. It may still be applicable in a dualist legal environment, but international law treaty override implications would still remain valid.
Tax treaties between Slovakia and the Middle East countries
2021
The objective of this article is to provide a basic systematic review of tax treaties between Slovakia and the Middle East States and their similarities and differences as compared to the standard OECD/UN Model Tax Conventions. The methods used include abstraction, comparison, analysis, synthesis, induction, deduction, and summarization. Findings include diverging practice concerning the scope and objective of double tax treaties such as criteria for residency, zakat provisions, transfer pricing rules, and anti-abuse rules. Taking into account the context of Slovak administrative practice and lack of experience with double tax treaties this diverging practice may lead to occasions of tax treaty override.
2010
Resumen: En enero de 2003 la OCDE introdujo importantes reformas en los Comentarios al Convenio Modelo en relacion con el problema la de aplicacion de clausulas internas anti-abuso en un contexto internacional. Conforme a la nueva posicion de los Comentarios la aplicacion de dichas clausulas nunca podria dar lugar a un conflicto con los convenios de doble imposicion pues constituyen exclusivamente reglas para determinar los hechos que eventualmente pueden dar lugar al nacimiento de la obligacion tributaria. Nuestro trabajo tiene como objetivo aflorar algunas debilidades de esta posicion: 1) Resulta juridicamente inconsistente y promueve la confusion entre transacciones simuladas y elusivas; 2) Se aparta de la verdadera solucion del problema que pasa por el analisis de las tecnicas de aplicacion de normas desde una perspectiva de teoria del Derecho. Conforme a este analisis demostramos como gran parte de los supuestos de treaty shopping pueden resolverse mediante una correcta interpr...
Kluwer international tax blog, 2022
Domestic responses against international tax avoidance have sharply increased in the latest years worldwide (in this sense, DAC 6-type rules are worth mentioning). In this contest, GAAR shopping by competent authorities and tax administrations is a great challenge. These agencies are often inclined to pile up anti-avoidance rules of a treaty or domestic nature without any hierarchy or prevalence of application, and to surf back and forth on them to enhance the scope of the taxable event and revenue collection to its maximum possible reach. As a refinement of previously existing domestic GAAR, bilateral and multilateral (MLI) treaty anti-abuse responses have established a set of standards for transactions under the treaty umbrella that might create an overlapping effect, and hence, increase uncertainty unless sound ordering principles are followed in their application. Some ordering principles are advanced in MLI itself, but others must be developed considering the nuances of each jurisdiction’s domestic rules and treaty network, as demonstrated in the attached discussion which is particularly focused on Argentina.
The EU Directive against Tax Avoidance (ATAD-1)
Contemporary issues in Tax Research, 2017
The Anti Tax Avoidance Directive (ATAD-1) is perhaps the most important goal achieved so far by the European Union in the struggle against international avoidance and evasion: it makes the most of the findings and recommendations OECD summarized in the BEPS action plan. The goal of this paper is to compare the solutions adopted by the EU in the directive with the domestic provisions already in force in some member States, including Italy and the UK. The methodology chosen is comparative in its nature. Qualified anti-avoidance provisions (such as GAARs and DPT) already in force on a national scale have be tested in order to see whether they are compatible with the new European guidelines and rules. The first findings allow the interpreter to draw different conclusions depending on the national rules tested. While for some of them, such as the DPT (Diverted Profits Tax) the consistency with OECD recommendations and EU law is uncertain, others (such as most of the National GAARs) appear to be already compliant with the new European standards. In this later case however, the influence of EU law will be arguably essential in terms of interpretation of the rule, widening or narrowing its scope, together with the need to counterbalance the power of the Tax administration with the protection of the fundamental rights of the taxpayer that some Administrations are reluctant to grant while making use of GAARs. The conclusions stress also the innovative double standard approach of the EU legislator that made use of different provisions (more or less aggressive towards the taxpayer) depending on whether the tax structure is European or involves also third Countries.