Ever-changing regulations, global tax competition and digitalisation mean that multinational corporations (MNCs) are confronted with increasing tax complexity. This is revealed in the “Global MNC Tax Complexity Survey 2022”.
The study has been published every two years since 2016 by the Ludwig Maximilian University of Munich and the University of Paderborn. Among the 16 international tax service networks and companies surveyed, colleagues from ECOVIS International were also able to contribute their knowledge and experience.
Tax systems around the world are not getting any easier. Multinational companies need a lot of financial and human resources to meet their tax obligations.Alexander Weigert, auditor, tax consultant and board member at Ecovis in Munich, Germany
The study describes
Of the 15 tax regulations examined, consultants in 65 of 95 countries rate transfer pricing as the most complex, with an index of 0.64.
From 2020, the survey has also questioned the influence of digital technologies on various tax processes. In 77 of 95 countries, filing and paying taxes have seen the most changes as a result of digitalisation. Other dimensions, such as access to digital legal redress procedures, have changed little or not at all through digital technologies.
The complexity of selected tax regulations worldwide and in Germany
|Foreign-controlled company rules
 The index ranges from zero (not complex) to one (very complex)
All the results of the study can be found here:
Alexander Weigert, auditor, tax consultant and board member at Ecovis in Munich, Germany
On 20 December 2023, Brazil approved brand-new legislation on consumption and transactional taxation. The main objective of the legal modifications is to simplify a host of levies on goods and services. After a transition period of 7 years (from 2026 to 2032), taxation will be based on a dual VAT system. The Ecovis experts explain the details of the VAT tax reform.
We support international companies wanting to take advantage of the more favourable tax conditions in Brazil and invest here.Mauricio Santos Nucci, Senior Partner in the Tax Law Department, Vaz de Almeida Advogados – Member of ECOVIS International, São Paulo, Brazil
For more information about all the changes, please download the PDF to see the details prepared by the local Ecovis lawyers:
Although approved, there are several aspects still to be defined by a complementary law that will be forwarded to the Brazilian National Congress. Among these, the tax rate is the most anticipated. According to the government, this could be around 27.5%, but it will be defined according to government revenue expectation and the granting of special regimes.
In addition, the approval of the consumption tax reform established a deadline of 90 days for the submission of the bill to reform income taxation.
It is a well-known fact that Brazil intends to simplify its taxation system, which is seen internationally as a barrier to doing business in the country. With this in mind, it is expected that the reforms will create a better commercial environment with the aim of bringing more investors to the country, explain the Ecovis experts.
Mauricio Santos Nucci, Senior Partner in the Tax Law Department, Vaz de Almeida Advogados – Member of ECOVIS International, São Paulo, Brazil
The “Wet Homologatie Onderhands Akkoord” (WHOA), or the law on Court confirmation of extrajudicial restructuring plans, introduced in the Netherlands in 2021, has proven its worth for restructuring companies through a private debt agreement with creditors and shareholders.
The flexible debtor in possession procedure has already been used to successfully complete several major international restructurings, with confirmations by Dutch courts.
The Dutch legal arrangement concerning the confirmation of extrajudicial restructuring plans is a flexible debtor in possession scheme, where a private agreement can be offered to all or a part of the creditors and shareholders of a company. Creditors and shareholders are divided into different classes. Within these classes, the minority is bound by the majority of the votes. The court can enforce the private agreement on dissenting classes using a confirmation decision (cramdown).
To increase the chances of successful restructuring, the court can apply protective measures, such as a cooling-off period during which some rights of creditors can be limited. Under certain circumstances, the court can appoint a restructuring expert to prepare the agreement. The court can also appoint an observer to oversee the formation of the agreement, keeping in mind the interests of the creditors, as the Ecovis experts know.
An important aspect of this Dutch scheme of arrangement is deal certainty. In the preliminary stages of the agreement’s formation, decisions can be requested from the court concerning disputes about the agreement between the companies and creditors or shareholders. No appeal is possible against a court’s decision to confirm an agreement.
We advise companies in need of restructuring, examine various options and show alternative courses of action.David Bos, Attorney-at-law, Partner, KienhuisHoving – Member of ECOVIS International, Utrecht, Netherlands
WHOA offers a public and a private variant, both of which are applicable in international contexts. The advantage of a public procedure is that it is listed in Annex A of the European Insolvency Regulation, which means that a decision to approve an agreement is automatically recognised in most European countries. For a private procedure, recognition of decisions by the Dutch court must be sought through common international private law.
International companies conducting the administration of their interests in the Netherlands on a regular basis and which is ascertainable by third parties, can always use WHOA. An indication of this is the presence of a statutory seat in the Netherlands. International companies with a branch in the Netherlands can also restructure the debts of that branch through the Netherlands. If a company or (debt) agreement(s) are otherwise sufficiently connected to the Dutch legal sphere, the Dutch court can also approve a WHOA agreement. Indications for this include (substantial) assets in the Netherlands, a legal or forum choice in contracts related to the debts to be restructured, being part of a Dutch group of companies, or liability for group debts subject to Dutch jurisdiction.
David Bos, attorney-at-law, Partner, KienhuisHoving – Member of ECOVIS International, Utrecht, Netherlands