European Commission publishes BEFIT and transfer pricing proposals

The European Commission has published two key proposals in the past week; Business in Europe: Framework for Income Taxation (BEFIT) and harmonized transfer pricing rules.  

The BEFIT proposals set out rules for the calculation of the BEFIT tax base, the allocation of the BEFIT tax base to members of the BEFIT group, as well as rules governing the transposition of the directive into local law.  

The Institute, under the auspices of the CCAB-I, responded to last year’s consultation on BEFIT and recommended that BEFIT should not be implemented until such time as the Pillar Two minimum taxation rules have matured to at least some degree. 

With regard to transfer pricing, the proposals are aimed at harmonising transfer pricing rules within the EU and ensuring a common approach to transfer pricing.