On Thursday 25 August, the OECD published over 750 pages of comments received from 71 contributors to the progress report on Amount A of Pillar I it published mid-July. The progress report contains a comprehensive draft of the technical model rules to implement the new taxing right and officially acknowledges the new timeline to deliver the Multilateral Convention for the implementation of Amount A. The OECD will organise a public consultation meeting on 12 September in hybrid format to discuss comments received from the public.
On Wednesday 24 August, the Financial Action Task Force (FATF) published its Mutual Evaluation Report on the Netherlands. It concluded that the Netherlands’ measures to combat money laundering and terrorist financing are delivering good results, but the country needs to do more to prevent legal persons from being used for criminal purposes, strengthen risk-based supervision, and ensure sanctions for money laundering and terrorist financing offences are proportionate and dissuasive. According to the report, the Netherlands’ main money laundering risks are related to fraud and drug related offences, which represent 90% of all Dutch proceeds of crime. On Thursday 25 August, the FATF also published its Mutual Evaluation Report on Germany and concluded that the country has implemented significant reforms in the last five years to strengthen its system. Although some of these new measures are already delivering results, Germany needs to continue to implement reforms and take steps to make sure that there is resourcing and prioritization at the operational level to combat illicit financial flows, it added. Domestic coordination across Germany’s 16 Länder is a challenge and coordination and consistency between the different supervisory and law enforcement authorities should be enhanced, the FATF explained.
On Monday 22 August, the European Commission proposed to authorise Portugal and Sweden to apply a temporary reduction of the national tax rates for certain kinds of petrol and gas oil used as motor fuels, below the minimum levels of taxation laid down in the ‘Energy Taxation Directive’. The temporary reduction would apply until 31 December 2022 for Portugal and for 3 months for Sweden. According to the Portuguese and Swedish authorities, the aim of the measure is to mitigate the high retail fuel prices associated with the consumption of motor fuels, resulting from the current geopolitical developments, and directly affecting both households and companies. Given its short duration and “the exceptional circumstances linked to the geopolitical situation coupled with an exceptionally high market price of crude oil”, the Commission found that the requested authorisations are considered to be adequate and proportionate. It agreed that it is not likely to distort competition or hinder the proper functioning of the internal market and that the tax reduction would partially offset the increased energy costs. The decisions must now be approved by the Council of the EU.