CJEU – Recent Developments in Direct Taxation 2016

1. S. 34The Cases

1.1. Follow up on case C-593/14; Masco Denmark ApS

The Danish CJEU case on direct taxation of 2015 was case C-593/14; Masco Denmark ApS and Damixa ApS v Ministry of Taxation. The case deals with the refusal to allow a Danish parent company a tax exemption for interest income received from an affiliated company within the same group established in Germany, even though the German company was not entitled to a tax deduction for the corresponding interest expenditure as a result of German rules on interest deduction limitation in cases of thin capitalization. The issue of EU law in the case relates to the freedom of establishment in that Denmark allows a resident parent company a tax exemption for interest income in cases where an affiliated company within the group that is resident in Denmark is not allowed a tax deduction for the corresponding interest expenditure as a result of the Danish rules on thin capitalization.

The request for a preliminary ruling in the case was discussed in a presentation given at the 2015 conference on Recent and Pending cases at the CJEU on Direct Taxation. On 12 May 2016 Advocate General Kokott issued her opinion.

The Advocate General considers ...