The assessment of the compliance of patent box tax regimes with rules in the context of economic and tax competition
Abstract
The aim of the article is to discuss preferential patent box tax regimes and it focuses on their assessment in terms of compliance with European Union state aid rules and European and international rules to combat harmful tax competition. The aim of the article is to point out that the purpose of these rules is to limit the negative effects of the introduction of these preferential regimes on competition within the EU and tax competition.
The article focuses mainly on issues within the EU, offering an international context of the OECD. However, the problem of both sets of rules, despite their differing binding nature, is the lack of clarity and the risk of their various interpretations, which results in the inability to determine with certainty whether a particular patent box regime will be declared as incompatible state aid or harmful tax competition.
The article concludes that, in the case of state aid rules, there is no support in the CJEU case law, but on the basis of theoretical assessment taking into account similar tax cases patent box regimes can fulfill all the conditions for state aid to exist. By adjusting properly, these regimes can avoid the assessment of their harmfulness to tax competition.