Recent amendments was made to the EU Parent-Subsidiary Directive into Luxembourg tax law and published on 5 August 2015. It has already been submitted to the Luxembourg Parliament. The measures include the provisions to modify the domestic participation exemption regime so as to comply with the new rules and Dividends within the scope of the Parent-Subsidiary Directive, when paid by a Luxembourg company to another EU company (or to an EU permanent establishment of another EU company) would not benefit from a withholding tax exemption if the transaction is characterized as an “abuse of law”. The new measures allow for the possibility to apply “horizontal” tax unity, whereby eligible sister companies could form a tax unity group. The investment tax credit would be made available for a lessor of ships used in international traffic.
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