Harmful tax practices: country ratings summary

European Parliament
The European Parliament has spoken strongly against both patent boxes and letterbox companies, and proposed public access to information about the content of advance pricing agreements between governments and multinational corporations.
European Commission
Despite speaking out against patent boxes, the European Commission has accepted patent boxes that follow the OECD rules. The Commission has not supported the European Parliament’s call for a ban on letterbox companies, but also does not promote them.
While the Commission does not support the Parliament’s call for more public information about the content of advance tax agreements, the Commission has initiated several state aid cases to prevent specific very harmful agreements.
Austria
Austria has a high amount of investment going through
special purpose entities, but does not have a patent box or a significant number of unilateral advance pricing agreements with multinational corporations.
Belgium
Belgium has a patent box and a high number of unilateral advance pricing agreements with multinational corporations.
Czech Republic
The Czech Republic has a significant number of unilateral advance pricing agreements with multinational corporations, but does not have a patent box.
Denmark
Denmark does not have a patent box or any unilateral advance pricing agreements with multinational corporations. However, Denmark’s limited liability companies can be used for international tax avoidance and are therefore a cause for concern. The government has announced its intention to close this loophole.
Finland
Finland does not have a patent box. However, it has a significant number of unilateral advance pricing agreements with multinational corporations.
Germany
Germany does not have a patent box or any unilateral advance pricing agreements with multinational corporations.
Hungary
Hungary has a patent box and a significant number of unilateral advance pricing agreements with multinational corporations.
Ireland
Ireland has been identified as the world’s fourth largest conduit jurisdiction. The country also has a patent box.
Italy
Italy has a patent box and a significant number of unilateral advance pricing agreements with multinational corporations.
Latvia
Latvia has introduced a system that allows multinational corporations to pay zero per cent corporate tax on retained or reinvested earnings.
Luxembourg
Luxembourg has been identified as the world’s largest sink jurisdiction. It has a patent box and a very high number of unilateral advance pricing agreements with multinational corporations.
The Netherlands
The Netherlands has been identified as the world’s largest conduit jurisdiction. It has a patent box, a high number of letterbox companies, as well as a high number of advance pricing agreements with multinational corporations.
Norway
Norway does not have a patent box, or unilateral advance pricing agreements with multinational corporations.
Poland
Poland does not have a patent box. Poland’s number of unilateral advance pricing agreements with multinational corporations is relatively low.
Slovenia
Slovenia does not have a patent box or unilateral advance pricing agreements with multinational corporations.
Spain
Spain’s holding companies (ETVEs) can be used as vehicles for corporate tax avoidance. Spain also has a patent box and a significant number of unilateral advance pricing agreements with multinational corporations. Spain has a patent box and a significant number of unilateral advance pricing agreements with multinational corporations.
Sweden
Sweden does not have a patent box or any unilateral advance pricing agreements with multinational corporations. However, Sweden’s limited liability companies present a risk of abuse and are thus an issue of concern.
United Kingdom
The UK is the world’s 2nd largest conduit jurisdiction. It has a patent box and a significant number of unilateral advance pricing agreements with multinational corporations.

DOWNLOAD REPORT