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Internal Market: Iceland's exit taxation rules are in breach of EEA law

11.11.2015

PR(15)55 

EN| IS

Icelandic rules providing for immediate taxation of companies and shareholders upon the movement or transaction of companies from Iceland to another EEA State are not in line with the EEA Agreement. This is the conclusion of a reasoned opinion delivered by the EFTA Surveillance Authority today.

The Icelandic tax system requires immediate recovery of tax when companies transfer their registered seat from Iceland to another EEA State, divide cross-border or transfer assets for use outside Iceland. The Authority considers such immediate recovery of an exit tax, without the possibility of a deferral, to be in breach of the freedom of establishment and the free movement of capital.

The Authority is also of the opinion that Iceland is in breach of the freedom of establishment by requiring guarantees in cases of cross-border mergers when the amount of the deferred tax exceeds 50 million ISK (approx. 355 000 EUR), without any prior assessment of the risk of non-recovery.

A reasoned opinion is the second stage of the infringement procedure. The Authority can bring the matter before the EFTA Court if the State fails to comply with the reasoned opinion within two months.


Documents


For further information, please contact:

Mr. Andreas Kjeldsberg Pihl
Press & Information Officer
tel. (+32)(0)2 286 18 66
mob. (+32)(0)492 900 187




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