Pillar 2 and CFCs: divergence of tax bases and risks of double taxation

With the article published in Corriere Tributario no. 7/2023 Giovanni Rolle and Francesco Scarfone continue the analysis started on publication 6/2023 with some considerations regarding the determination of the level of effective taxation of the constituent entities belonging to multinational groups according to the Pillar 2 rules, highlighting in particular the need to carry out multiple and distinct processing of the economic-financial data of the controlled entities,  made more complex by the diversity of the rules applicable with respect to the discipline of controlled foreign companies (CFCs).

The article then focuses on the possible double taxation of so-called “passive” income deriving from the simultaneous application of the CFC discipline and on the amendments made to the OECD priority rules, which involve, in the opinion of the authors, the need to adapt the Italian legislation when transposing the EU directive.