The European Commission on 19 December 2018 announced its final decision on the state aid investigations into Gibraltar’s corporate tax regime.
The EC decision affirms a preliminary view that Gibraltar’s tax exemption regime for interest and royalties—as well as five tax rulings—constitutes state aid that is incompatible with the internal market rules in the EU. As a result, the EC directed Gibraltar to recover the aid from the beneficiaries.
What’s next? It is now up to both Gibraltar and the companies that received the aid to appeal the decisions before the General Court (and possibly later the Court of Justice of the European Union (CJEU)).
Read a December 2018 report [PDF 125 KB] prepared by KPMG’s EU Tax Centre